[Click eStock] "Neowiz, Expectations for Blockchain Launch and Regulatory Easing"

[Asia Economy Reporter Lee Jung-yoon] Daishin Securities maintained a buy rating and a target price of 35,000 KRW on NeoWiz on the 4th, expecting performance improvement due to the launch of two blockchain platforms and the easing of game regulations.

The NeoWiz Group plans to launch two blockchain platforms, Neopin and Metarama, this year to build a blockchain ecosystem. Neopin, launched by Neofly, a subsidiary of NeoWiz Holdings, will start service in the first quarter of this year. Neopin is a blockchain open platform that provides financial services along with additional S2E (Service to Earn) and P&E (Play and Earn) content. The cryptocurrency used on Neopin is NPT, which was listed on two global cryptocurrency exchanges as of the 28th of last month, and some decentralized finance (De-fi) services have also been opened.

Metarama, launched by NeoWiz subsidiary Metarama, is a blockchain platform dedicated to P&E and non-fungible token (NFT) games. The cryptocurrency Lama is expected to be released, issued, and listed in the first half of this year and is predicted to be onboarded to two games.

However, Lee Ji-eun, a researcher at Daishin Securities, said, "Guidelines for accounting treatment of blockchain platform revenue have not yet been established, and even after the release of P&E games, the portion that can be recognized as related sales is expected to be minimal in the short term," adding, "Ultimately, the performance of games serviced by the company is considered important."

The easing of regulations on web board games is also expected to lead to performance improvement for NeoWiz. The researcher explained, "In February this year, the Ministry of Culture, Sports and Tourism announced a legislative notice to amend the Enforcement Decree of the Game Industry Promotion Act to ease regulations on web board games, mainly raising the monthly purchase limit from 500,000 KRW to 700,000 KRW," adding, "NeoWiz's web board games are understood to be recording steady sales due to the peak season in the first quarter, and continuous growth in web board game sales is expected upon the passage of the amendment in April."