Game Stocks Brighten Up, ETFs Also Smile

Favorable Factors for China’s Game License Issuance and New Releases
Kakao Games and Pearl Abyss Surge
Related ETFs Also Strong

[Asia Economy Reporter Song Hwajeong] Recently, positive developments in gaming stocks have continued, leading related exchange-traded funds (ETFs) to also show strong performance.

According to the Korea Exchange on the 8th, TIGER KRX Game K-New Deal has risen 8.73% so far this month through the previous day, recording the highest return among all ETFs. Following this, KODEX Game Industry (5.25%) and KBSTAR Game Theme (4.39%) also ranked high in returns.

Recently, positive news such as the issuance of Chinese game licenses (game service permits) and the success of new releases has led to an overall rise in gaming stocks, resulting in related ETFs recording favorable returns. Kakao Games has risen more than 30% this month. Due to the success of new releases, it surged over 24% on the 2nd. Pearl Abyss rose 3.3% during the same period. On the 29th of last month, news of the issuance of Chinese game licenses caused it to surge more than 20%.

Kakao Games’ new release success translated into stock price gains. The new game "Odin," officially launched by Kakao Games on the 29th of last month, topped sales charts on Google and Apple app markets, achieving great success. Odin attracted over 4 million pre-registrations, raising expectations for its success. Sung Jonghwa, a researcher at Ebest Investment & Securities, said, "Odin’s sales over two days in Q2 this year are estimated at about 15 billion KRW, and considering deferred revenue, accounting sales are estimated at 12 billion KRW," adding, "For the third quarter, which is effectively the first quarter, daily average sales in the high 1 billion KRW range are quite possible." Ebest Investment & Securities raised its earnings forecast by upgrading Odin’s outlook for Korea and increased the target stock price from 66,000 KRW to 73,000 KRW.

Pearl Abyss’s "Black Desert Mobile" obtained a game license from the Chinese National Press and Publication Administration on the 29th of last month, causing a significant rise in its stock price. An Jae-min, a researcher at NH Investment & Securities, said, "With this license issuance, Black Desert Mobile can now be serviced in China," and added, "It is estimated that Black Desert Mobile can rank within the top 10 in the Chinese app store sales rankings, with daily average total sales exceeding 2 billion KRW." NH Investment & Securities upgraded Pearl Abyss’s investment opinion from ‘Hold’ to ‘Buy’ and raised the target price from 55,000 KRW to 100,000 KRW.

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