[Click eStock] YG Entertainment, Now GD Comes · Blackpink Jisoo Solo Also Expected

Kiwoom Securities announced on the 20th that it maintains a buy rating and a target price of 78,000 KRW for YG Entertainment. This is based on the assessment that strengthened artist activities such as BLACKPINK's world tour, Jisoo's solo debut, BabyMonster's debut, and GD's comeback will help the company move away from one-team risk, ensuring not only earnings stability but also sufficient growth potential.

YG Entertainment's sales and operating profit last year reached 391.2 billion KRW and 46.6 billion KRW, respectively. The stability of advertising revenue from BLACKPINK, who is active as a global ambassador, along with the growth in album and concert sales, has completely overcome the poor performance in 2021 caused by the absence of the full group. The fourth-quarter results last year recorded sales and operating profit of 125 billion KRW and 15.7 billion KRW, respectively. Concert performance is expected to be reflected from the first quarter onward, so there is only a time lag in performance improvement due to concerts.

Namsoo Lee, a researcher at Kiwoom Securities, stated, "We are focusing on the growth of TREASURE, which held dome concerts this year," adding, "With two album comebacks, the ongoing Asia tour, and the assumption of a world tour in the second half of the year, performance improvement is expected to proceed smoothly." He also anticipated a period of strengthened artist activities including BLACKPINK's world tour, Jisoo's solo debut, BabyMonster's debut, and GD's comeback.

BLACKPINK's world tour, which started in 2022, has currently opened 30 shows through June. The number of shows has increased compared to 26 last year, and the upgraded concert venue size and the reflection of deferred performance are also key points for this year's concert effects. TREASURE, which held 15 concerts last year (4 domestic, 11 overseas), started an Asia tour from March following arena concerts in Japan and Osaka Dome in January. It is expected that 2023 will see an expanded fandom effect through albums and concerts.

The biggest issue this year is the contract renewal with BLACKPINK. Assuming activities after BLACKPINK's contract renewal, there is a forecast that YG Entertainment's growth potential will become even brighter. Researcher Lee emphasized, "We should also pay attention to the million-seller target due to TREASURE's fandom expansion and the solo comebacks of BLACKPINK members," adding, "Therefore, the company is expected to emerge from the tunnel of poor performance caused by reduced artist activity."