[Click eStock] "Kakao, Leading Popular Stock in the Untact Era... Target Price Up 15%"

[Asia Economy Reporter Park Jihwan] Ebest Investment & Securities maintained a 'Buy' rating on Kakao on the 21st, stating that it has emerged as a representative popular stock in the untact era triggered by the novel coronavirus infection (COVID-19), and raised the target price by 15.4% from 260,000 KRW to 300,000 KRW.

Researcher Seong Jonghwa of Ebest Investment & Securities evaluated, "Online commerce (Gift Sending·Talk Store·Makers), techfin (Kakao Pay·Kakao Bank), paid content (Kakao Page·Piccoma) and other online untact platform businesses are fundamentally entering a high-growth phase." He explained that in the first quarter of this year, sales growth was highlighted due to the added benefit of COVID-19.

Researcher Seong Jonghwa emphasized, "With the acceleration of the untact era triggered by COVID-19, the future growth prospects of all major businesses have become even brighter," adding, "There are sufficient factors for upward revisions in premium, profit value, and subsidiary value."

In particular, major untact businesses such as Kakao Pay, Kakao Bank, and Kakao Page are evaluated to have strong growth potential as independent subsidiaries. Kakao Page not only achieved high sales growth but also rapidly improved profitability, with last year's operating profit margin rising to the 10% range. Kakao Bank surpassed its first quarterly net profit breakeven point in the first quarter of last year, and its net profit in the first quarter of this year reached 18.5 billion KRW, showing 180% growth compared to the previous year. Although Kakao Pay is still in a deficit, its profitability is rapidly improving thanks to steep external growth.

He said, "In the case of advertising, portal advertising has been negatively affected by COVID-19 in the first and second quarters, but in the mid-to-long term, it could serve as an opportunity for the online advertising market share to increase."

Researcher Seong forecasted, "With the acceleration of the untact era triggered by COVID-19, Kakao's untact businesses such as Pay, Bank, Page, and Commerce have all encountered a very favorable business environment," adding, "The high-growth energy is expected to continue without fading in the future, and profitability is also expected to improve more steeply."

This content was produced with the assistance of AI translation services.