[Click eStock] With New Release Schedule and MyData Business... NHN Full of Momentum in the Second Half

2Q Sales and Operating Profit Both Expected to Grow Over 10% YoY
"Performance Improvement to Continue in the Second Half"

[Asia Economy Reporter Minwoo Lee] NHN is expected to achieve double-digit growth in both sales and operating profit in the second quarter of this year compared to the same period last year. However, it is considered to have 'taken a breather' as it fell short of the initial market expectations. Various positive factors such as the release of new games and the selection as a Payco MyData operator in the second half of the year are expected to lead to strong performance.

On the 30th, Ebest Investment & Securities forecast that NHN will record sales of 403.2 billion KRW and operating profit of 28.2 billion KRW in the second quarter of this year. This represents an increase of 10.1% and 10.7%, respectively, compared to the same period last year. Compared to previous forecasts, sales showed little change, but operating profit fell by 9.1%, falling short of expectations.

Researcher Jonghwa Sung of Ebest Investment & Securities explained, "Mobile games decreased by about 2.0% compared to the previous quarter due to the absence of new releases, but PC games are estimated to have increased by about 6.4% compared to the previous quarter due to the easing of board game regulations and benefits from COVID-19. The non-game sector, including payment and online commerce in Korea and China, is expected to benefit from COVID-19, but advertising, U.S. commerce, Ticketlink (content), and Travel Doctor (others) are expected to be affected by COVID-19, resulting in an overall slight increase of about 2.7% compared to the previous quarter."

Performance is expected to steadily improve in the second half of the year. The easing of board game regulations remains effective, and the schedule for new mobile game releases is concentrated in the second half. Researcher Sung said, "The easing of board game regulations, which abolished the daily loss limit, was implemented from April 7, so the effect will continue into the third quarter. The regulatory easing effect is due to an increase in activity (dwell time, usage time) rather than an increase in daily active users (DAU), leading to a rise in average revenue per paying user (ARPPU)." Additionally, the government's selection of MyData (personal credit information management) business operators (NHN Payco) scheduled for August is also a key point to watch in the second half.

Based on these factors, Ebest Investment & Securities maintained a 'Buy' rating and a target price of 120,000 KRW for NHN. The closing price on the previous day was 80,500 KRW.

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