[Click eStock] "NAVER Expands Influence in Global Webtoon Market"

Hana Securities Report

[Asia Economy Reporter Minji Lee] Hana Securities forecasted on the 15th that NAVER is expected to expand its influence in the global webtoon market.

China's film adaptation of Jo Seok's SF webtoon 'Munyoo,' titled 'Dokhaeng Wolgu,' attracted a cumulative audience of 72.05 million as of the 13th, surpassing 600 billion KRW in cumulative box office revenue. This ranks as the second highest box office revenue in China this year. The cumulative Chinese box office revenue through September this year reached 25 billion yuan, six times the domestic box office revenue during the same period. Even before COVID-19, in 2018 and 2019, the annual box office revenues were 61 billion yuan and 64.3 billion yuan respectively, making it one of the largest content markets comparable to the United States.

The success of Dokhaeng Wolgu is significant as it demonstrates the possibility of indirect entry into the Chinese film market, the largest global market. The revenue NAVER can recognize from the success of Dokhaeng Wolgu is not substantial. NAVER sold the Chinese film adaptation rights of the original webtoon Munyoo to Showbox and did not participate in production investment, so it is not a contract party entitled to receive RS (revenue sharing). In addition to one-time revenue from the film adaptation rights sale, NAVER only received a portion of the RS from the original author Jo Seok under management fees.

Furthermore, the news that the transaction volume of Line Manga, NAVER's Japanese webtoon platform, and eBookJapan has exceeded 10 billion yen is also positive. Through the acquisition of eBookJapan, which has been reflected in consolidated results since the second quarter, NAVER now owns a major webtoon platform based on the web in addition to app-based platforms in Japan.

Yoon Yeji, a researcher at Hana Securities, stated, "The process of transplanting hit IPs from Korea to Japan will gain momentum," and predicted, "The global webtoon transaction volume forecast of 1.5 trillion KRW for NAVER, presented at the beginning of the year, is likely to be comfortably exceeded."