[Click eStock] "HYBE, Abundant Rebound Factors Despite Adore Controversy"

Low Possibility of Min Hee-jin's Dismissal... Issue Likely to Be Resolved
Bonecto and Aileet Growth to Defend Q2 Operating Profit
BTS Jin's Discharge and US Rookie Girl Group Provide Upward Momentum

Hana Securities analyzed on the 4th that despite the recent Adore issue, HYBE's stock outlook is positive due to its attractive price range and momentum in the second half of the year. They maintained a 'Buy' investment rating and a target price of 315,000 KRW. HYBE closed at 200,500 KRW in the previous trading session.

Researchers Kihoon Lee and Jiwon Hwang from Hana Securities stated, "Although legal procedures regarding the dismissal of Adore CEO Min Hee-jin are underway, the possibility of NewJeans leaving is low, limiting the potential for further downward revision of profits," adding, "From a valuation and sentiment perspective, the stock's bottom is important, and momentum such as BTS Jin's military discharge, the debut of a new U.S. girl group, and the monetization of the Weverse platform (Membership+) in the second half of the year can also be expected."

HYBE's consensus operating profit for the second quarter is expected to be around 90 billion KRW. The performance of rookie groups is rapidly expanding. ENHYPEN's comeback is scheduled for the third quarter. Although NewJeans' album initial sales (first-week sales) sharply declined, album sales of rookie groups like BoyNextDoor and ILY:1 are increasing, which is expected to help defend operating profit. Additionally, approximately 1 million attendees are expected to be reflected through world tours of SEVENTEEN, TXT, and ENHYPEN, as well as NewJeans' fan meeting at Tokyo Dome in Japan.

Researchers Kihoon Lee and Jiwon Hwang said, "The Adore issue has now shifted to HYBE, and legal procedures regarding CEO Min Hee-jin's dismissal are ongoing," adding, "Although HYBE constitutes the majority of Adore's board, the immediate execution of dismissal is unlikely given the ongoing legal process. Despite this complex situation, the stock price could have remained flat, but a press conference proposing reconciliation may help resolve the issue." From a shareholder's perspective, it is important for HYBE to prove that the problem is not with the multi-label system. If the issue is resolved, the human risk is likely to disappear. While monitoring HYBE's decisions, it is expected that once the Adore issue is settled, positive factors such as BTS members' military discharge and the debut of the U.S. girl group will be fully reflected in the stock price.