[Click eStock] "AfreecaTV, NFT and Metaverse New Business Expansion Becomes Visible"

[Asia Economy Reporter Minji Lee] Eugene Investment & Securities maintained a buy rating on AfreecaTV on the 28th but lowered the target price by 4% to 240,000 KRW.

AfreecaTV's Q4 revenue is expected to reach 74.3 billion KRW, and operating profit is forecasted at 24 billion KRW, representing increases of 24.7% and 35.7% year-over-year, respectively. Platform service revenue is projected at 55.9 billion KRW, and advertising revenue at 16.6 billion KRW, with respective growths of 24.9% and 20.2% during the same period.

Hyunji Lee, a researcher at Eugene Investment & Securities, stated, "The advertising segment likely recorded steep growth as the pool of non-gaming advertisers expanded and brand content advertising continued steady growth, while platform advertising also saw rising ad rates following the introduction of AfreecaTV Ad Manager (AAM)."

The investment point for AfreecaTV lies in expectations for new businesses. After opening the NFT marketplace AFT Market last November, the company plans to launch the beta service of its metaverse platform, FreeBlocks, as early as Q1 this year. Although still in the early stages with limited contribution to earnings, the ecosystem is expected to expand from users and BJs communicating via internet chat to an online space where they can interact bidirectionally in a virtual environment, offering many monetization opportunities. Fanbase lock-in and increased fanbase consumption are also anticipated.

The target price was adjusted downward due to a slight downgrade in platform service performance. Researcher Hyunji Lee said, "Advertising growth as a platform is expected to accelerate, with annual growth exceeding 50% this year. As the expansion of new businesses such as NFT and metaverse becomes more visible, valuation rerating is also anticipated."