[Click e-Stock] "NHN Needs New Title Success... Target Price Raised"

Target Price Raised from 18,000 Won to 22,000 Won

On April 22, NH Investment & Securities announced that it has raised its target price for NHN from 18,000 won to 22,000 won, citing that a certain level of uncertainty has been resolved. The investment opinion was maintained at 'Hold'.

Ahn Jaemin, a researcher at NH Investment & Securities, explained, "Last year, NHN recognized 140.7 billion won in bad debt expenses due to the payment default incidents involving TMON and WEMAKEPRICE, which led to poor performance and damaged sentiment regarding the Payco business due to increased uncertainty. However, much of this uncertainty has now been resolved."

NHN's first-quarter results this year are expected to meet market expectations. Ahn stated, "First-quarter revenue is expected to reach 660.1 billion won, up 9.2% year-on-year, and operating profit is projected at 27.8 billion won, up 2.0%. Operating profit is expected to meet both the previous estimate of 28.3 billion won and the market consensus of 26.3 billion won." He added, "While a decline in mobile revenue is inevitable as the effect of last year's 10th anniversary event for 'Disney TsumTsum' disappears, the web board games continue to serve as a stable cash cow." He further noted, "NHN Cloud and Techorus, which have shown steady growth, are expected to maintain the highest growth rates among NHN's core businesses this year."

He also emphasized that the success of new titles is necessary for a meaningful rise in the stock price. Ahn said, "Given the current situation where the Payco business inevitably needs to be scaled back, NHN must resolve the chronic issue of its underperforming game business. Starting with the release of 'Darkest Days (shooting RPG)' on April 24, other titles such as 'Abyssdia (subculture collection RPG)', 'Project STAR', 'Project MM', and 'EMMA' are scheduled for release this year. The success of these new titles will be crucial in generating renewed expectations."