[Click eStock] JYP Entertainment Plans Aggressive Rookie Group Debut... Target Price Up 16%

Hana Financial Investment Report

[Asia Economy Reporter Minji Lee] Hana Financial Investment maintained a buy rating on JYP Entertainment on the 16th, stating that the company has the most aggressive rookie debut plans, and raised the target price by 16% to 64,000 KRW.

Q3 revenue and operating profit are expected to reach 57.2 billion KRW and 18.2 billion KRW respectively, representing increases of 65% and 6% compared to the same period last year. The operating profit significantly exceeded the market expectation of 17.8 billion KRW.

With the addition of Stray Kids and NiziU, JYP now has a lineup capable of holding dome tours in Japan with four teams, and the most aggressive rookie debut plans are also in place. Kihoon Lee, a researcher at Hana Financial Investment, evaluated, “Considering the one-time costs of approximately 2 billion KRW for content production related to the debut projects of three teams and 1 billion KRW success fee for ‘LOUD,’ the results exceeded expectations.” Album sales reached about 2 million copies due to comebacks from Stray Kids and ITZY, and the rapidly growing overseas music sales (8.4 billion KRW) were reflected, achieving record-high profits.

In Q4, all artists plan to make comebacks, including TWICE’s full-length and repackage albums, Stray Kids’ repackage, NiziU’s first full album, 2PM’s solo mini album, and ITZY’s digital single. A rookie boy band group is also scheduled to debut. Expected revenue and operating profit are 52.8 billion KRW and 17.6 billion KRW respectively, representing growth of 27% and 67% compared to the same period last year.

Stray Kids sold 440,000 copies per album last year, but recently sold 1.3 million copies of their second full album, becoming the sixth and fastest artist to surpass 1 million copies. Along with 2PM and TWICE, who have already held dome tours, the addition of NiziU and Stray Kids has built a lineup capable of at least four dome tours in Japan. Researcher Kihoon Lee analyzed, “Assuming a full house, it is quite possible to attract around 1 million concert attendees in Japan,” and added, “Considering the success of five rookie groups debuting over the next two years, it is certain that JYP will achieve operating profits of 10 billion KRW, ranking third after HYBE and SM.”

Furthermore, Kihoon Lee said, “The establishment of strategic partnerships with major industry players such as DearU, Zepeto, and Toonami, with plans for further expansion, is also positive for the stock price.”