[Click e-Stock] "Kakao Set for Positive Second Half... Target Price Raised to 75,000 Won"

On July 10, Korea Investment & Securities raised its target price for Kakao to 75,000 won, an increase of 53.1% from the previous target. The company cited expectations for a favorable business environment in the second half of the year as the reason for the upward revision.

Jung Hoyoon, a researcher at Korea Investment & Securities, predicted that Kakao would deliver second-quarter results in line with market expectations. He estimated that revenue would reach 1.92 trillion won, down 4.2% year-on-year, while operating profit would be 118.1 billion won, a decrease of 11.9% over the same period.

While the Talk Biz and other platform segments are expected to grow compared to last year, revenue from the content segment is projected to decline by 13.8% year-on-year. This is due to underperformance in most business units except for Piccoma.

Jung believes that there are still many positive business factors remaining in the second half of the year. He said, "By revamping the Discovery Tab on KakaoTalk and adding new advertising inventories, as well as launching AI-based solutions such as AI Agent, we will enhance the quality of our services."

He added, "Discussions regarding stablecoins are progressing steadily, which is also a positive sign. The Kakao ecosystem, where Kakao Pay and stablecoins have clear use cases, can generate significant synergy."

In particular, Jung emphasized that attention should be paid to the intrinsic value of Kakao's core business in the second half. He stated, "If the recent rise in share price was driven by increased corporate value of financial subsidiaries due to expectations for stablecoin institutionalization, then from the second half onward, the focus should shift to a revaluation of the core business."

He further commented, "Since there is potential for renewed growth in KakaoTalk advertising, we have also adjusted the discount rate applied to KakaoTalk's valuation compared to Tencent's PSR from 40% to 20%. As long as the positive business environment continues in the second half, the upward trend in the stock price is also likely to continue."