NHN Hanguk Cyber Payment Exceeds Q3 Earnings Expectations... Clear Online Growth Trend

[Asia Economy Reporter Park Jihwan] Korea Investment & Securities stated on the 14th that NHN Korea Cyber Payment is showing clear growth centered on online payments, and the online-to-offline (O2O) sector is also progressing smoothly. Accordingly, they maintained a 'Buy' investment rating and set a target price of 98,000 KRW.

Researcher Jeong Inmook of Korea Investment & Securities said, "Operating profit in the third quarter was 11.2 billion KRW, exceeding market expectations by 10%." The growth rate of highly profitable online VAN fee income was higher than other sectors, and the proportion of overseas payments relative to total transaction volume was maintained at 10%, which was evaluated positively for profitability.

Researcher Jeong Inmook analyzed, "The average monthly PG transaction volume in the third quarter was 2.2 trillion KRW, a 5% increase compared to the previous quarter," adding, "The domestic online shopping mall transaction amount reached 42 trillion KRW, significantly increasing from the previous quarter, which was a key factor."

The major new business, overseas payments, also continued its growth trend due to increased transaction volume from the Apple App Store and increased deliveries of Tesla completed vehicles. They explained that by signing a contract to provide payment services for Google Play, future improvement in the mix through expansion of the overseas payment ratio is expected.

Sales in the O2O business division also increased by 80% compared to the previous quarter, thanks to a significant increase in new merchant launches in the third quarter. Researcher Jeong explained, "As the COVID-19 pandemic has lasted for over a year, existing offline transactions have rapidly shifted online, limiting the possibility of a sharp slowdown in the online payment market."

In particular, he forecasted, "With O2O merchant contract launches, which had been sluggish compared to contract numbers due to COVID-19, now proceeding normally, growth in the O2O sector is expected to accelerate."

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