Will the Ban on Chinese Games End... Soaring 'Game Stocks'

[Asia Economy Reporter Oh Ju-yeon] On the 3rd, game stocks in the domestic stock market rose simultaneously. This is interpreted as a result of expectations that the Chinese game market might open for the first time in four years since the 2017 Terminal High Altitude Area Defense (THAAD) incident, following the recent approval of service licenses for Korean games in China.

In the KOSPI market, Netmarble and NCSoft showed strong performance. Netmarble traded at 132,500 KRW, up 5.58% from the previous trading day, while NCSoft rose 2.68% to 882,000 KRW.

In the KOSDAQ market, YJM Games traded at 1,710 KRW, up 22.30% from the previous day, and Com2uS surged 15.27% to 163,000 KRW. Among the top market capitalization stocks, Kakao Games (0.31%) and Pearl Abyss (5.93%) also rose.

According to the Chinese National Press and Publication Administration website on the previous day, Com2uS's game 'Summoners War: Sky Arena' received a foreign (foreign-made) license. The industry explains that this is the first issuance of licenses for Korean games in over four years since China delayed issuing licenses.

Jae-min Ahn, a researcher at NH Investment & Securities, evaluated, "If the issuance of licenses for Korean game content begins and distribution within China resumes, it will be very positive for domestic game stocks." Researcher Ahn added, "Since no Korean games have received licenses since the first quarter of 2017 when the THAAD issue occurred, this change due to the license is positive," and predicted, "The Chinese mobile game market is about 27 to 28 trillion KRW, more than three times larger than Korea's. If Korean games rank high on the Chinese app store, it will positively impact performance."