"'Odin' Overseas Expansion with Metaverse and NFT... Kakao Games, a Rising Star This Year"

Odin Expands to Taiwan, Japan, Europe, and North America in H1... Overseas Performance Up
Developing Metaverse and NFT Platforms... Expanding New Businesses
Valuation Pressure Decreases with Performance Growth

[Asia Economy Reporter Minwoo Lee] Kakao Games has been recognized as a leading prospect in the gaming industry this year. This is due to the upcoming overseas expansion of the domestically successful game "Odin," as well as anticipated growth driven by the full-scale launch of metaverse (expanded virtual world) and non-fungible token (NFT) businesses.

On the 2nd, Hyundai Motor Securities analyzed that Kakao Games is likely to secure a corporate value that matches its recently rising stock price based on these factors. Last year, Kakao Games' stock price rose by more than 97%.

First, the overseas expansion of Odin is scheduled. Starting with Taiwan in the first half of the year, it will be sequentially released in regions such as Japan, Europe, and North America. "Elyon" is also expected to contribute to the expansion of overseas market share as its overseas expansion results become more active. It was reported that all games to be released in the future are being developed with overseas expansion in mind. Hyundai Motor Securities researcher Hyunyong Kim explained, "In the first half of this year, the focus will be on the overseas expansion of existing successful titles, while the second half will feature multiple highly anticipated new releases, including massively multiplayer online role-playing games (MMORPGs). Representative titles include Project Ares, Eversoul, and new MMORPGs from XL Games."

The new businesses such as metaverse and NFT are also expected to be fully launched. The metaverse project is led by the affiliate Neoptoon. It is understood that they are currently preparing their own metaverse platform utilizing content such as games and virtual idols. The NFT business is being prepared by the subsidiary Friends Games, which is reportedly developing an NFT trading platform specialized in games, sports, and metaverse. Researcher Kim said, "Through this platform, it is expected that sales of game items serviced by Kakao Games and merchandise of K-pop singers under Kakao Entertainment will be possible," adding, "Starting this year, by implementing the goal of 'Beyond Game,' Kakao Games' revaluation will accelerate further."

This upward trend is also expected to reduce the burden of corporate valuation. First, with Odin’s huge success and the completion of the acquisition of Odin’s developer Lionheart Studio, the valuation burden has significantly decreased. Although the average operating profit margin over the past three years remained at 11.2%, it is expected to rise to 20-25% from this year, considering the consolidation of Lionheart Studio.

Researcher Kim analyzed, "Not only the internalization of development capabilities and profitability improvement through aggressive investments in developer shares and mergers and acquisitions (M&A), but also the increase in investment share value is positive," adding, "The 1.70% stake Kakao Games holds in Krafton exceeds a value of 400 billion KRW based on the IPO price of 498,000 KRW per share."

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