[Click eStock] "JYP, Expecting High-Margin Overseas Sales Growth... Target Price Up 10%"

Korea Investment & Securities Report

[Asia Economy Reporter Minji Lee] Korea Investment & Securities maintained a buy rating on JYP Ent. on the 21st, expecting an increase in overseas sales, and raised the target price by 10% from the previous level to 72,000 KRW.

JYP is expected to record sales of 60.2 billion KRW in the first quarter, an 86% increase compared to the same period last year. Operating profit is forecasted to grow by 37% to 18.9 billion KRW. Due to the explosive growth of Stray Kids, album sales reached a record high of 2.4 million copies, and the initial sales of Stray Kids' mini-album released on March 18 reached 850,000 copies, a 33% increase compared to the initial sales of 640,000 copies of the previous full album. Thanks to strong album sales, music and sound source sales are expected to have increased by 154% year-on-year to 38.2 billion KRW.

Park Hak-kyung, a researcher at Korea Investment & Securities, said, "Concert sales are estimated to have reached 2.1 billion KRW due to the TWICE concert in the U.S. held in February and the Stray Kids domestic fan meeting," adding, "The U.S. concert operates on a minimum guarantee (MG) per show basis, so while the sales scale is not large, most of it is reflected as profit, so the profit contribution is expected to be high."

While the reputation of the girl group powerhouse continues with TWICE, ITZY, and NMIXX, the growth of the boy group is steep. Stray Kids' album sales last year reached 2.64 million copies, more than double the 990,000 copies in 2020, accounting for half of the total sales. With active activities from the company's lineup this year, album sales are expected to increase by 46% year-on-year to 7.8 million copies.

In the second half of the year, the world tour is also expected to be in full swing. Both Stray Kids and TWICE have announced tours in Japan and the U.S., and NiziU is also expected to be able to hold a dome tour. With the resumption of concerts, MD sales are estimated to have reached 22 billion KRW, an 81% increase compared to the same period last year.

Researcher Park said, "With cooperation with Republic Records, JYP's target market is expanding to North America, and Stray Kids' latest album achieved No. 1 on the Billboard 200," adding, "Next year, with the addition of overseas lineups such as NiziU Boy, the proportion of overseas sales is expected to rise to 52%."