[Click eStock] "Studio Dragon, Focus on Next Year's Growth Over Q3 Earnings Slump"

[Asia Economy Reporter Ji Yeon-jin] Eugene Investment & Securities stated on the 25th that although Studio Dragon is expected to have poor performance in the third quarter of this year, performance improvement is anticipated as drama series are scheduled to air in the United States in the second half of next year. They maintained a buy investment opinion and a target stock price of 130,000 KRW.

Hyunji Lee, a researcher at Eugene Investment & Securities, said, "The Big Door Prize," which is expected to air as early as the second half of next year, is very positive in that it is the first case where a domestic drama production company participated from the planning stage together with a global OTT to produce the work. Since it has opened the door to the U.S. market, there is also the possibility of additional series orders, and after a brief slowdown this year, performance improvement is expected in various fields next year."

Studio Dragon's third-quarter sales are projected to increase by 12.5% year-on-year to 119.5 billion KRW, while operating profit is expected to decrease by 6.6% to 15 billion KRW. Although the number of aired episodes has normalized to about 5.7 episodes, operating profit is expected to decline compared to the previous year as only about two works were pre-sold to Netflix. However, the continued rise in sales prices and active sales by region are seen as positive signs of defending profitability.

The researcher added, "This year, the production environment was not favorable, and the major productions 'Island' and 'Hwanhon,' which were scheduled to air, have been postponed to next year, and major works such as 'After School War Activities,' 'Bulgasal,' and 'Our Blues' are lined up one after another."