[Click eStock] "Kakao, Short-Term Earnings Improvement Difficult but Growth Potential Remains"

[Asia Economy Reporter Ji Yeon-jin] Samsung Securities stated on the 10th that although the short-term earnings improvement potential for Kakao is not high, ongoing new investments keep its long-term growth potential high, maintaining a buy investment opinion and a target stock price of 120,000 KRW.

On the previous day, Kakao's CEO Namgung Hoon and key executives presented their long-term growth strategy to securities analysts. CEO Namgung highlighted the evolution of a new business and interest-based platform centered on Open Chat and Profiles as Kakao's main growth drivers. Open Chat is an interest-based community currently used by 9 million people, characterized as a public space unlike private one-on-one chat windows, suggesting potential monetization through advertising in the future. Additionally, they revealed the possibility of generating additional revenue through a paid subscription model for Open Chat rooms.

Furthermore, Kakao plans to enter the logistics market with mobility and Picker services. In mobility, they explained strengthening competitiveness in the logistics brokerage market by expanding delivery methods in the Picker app and the potential to enter the offline advertising market through the application of rear-seat entertainment systems. They disclosed a roadmap for development into an autonomous driving platform; Kakao Mobility aims to secure new revenue sources by expanding user-based advertising and delivery brokerage services and plans to enter the global market and autonomous taxi platform market in the mid to long term.

Kakao Healthcare, newly established this year, will provide personalized disease management services based on Kakao's users and big data, including health habit diagnosis and lifestyle management tailored to user lifestyles, genetic diagnosis, online medical questionnaires, appointment booking and payment, and medical big data analysis.

Samsung Securities researcher Oh Dong-hwan said, "New growth drivers such as strengthening the business and interest-based community, enhancing profile functions, strengthening the B2B2C creative ecosystem, and the 3D-based metaverse ‘Colorverse’ are expected to function as features that strengthen the KakaoTalk ecosystem from a long-term perspective rather than contributing to profits within 1-2 years." He added, "Until Kakao's new initiatives bear fruit, Kakao's profit growth will ultimately depend on the recovery of the domestic advertising and commerce markets and the success of new game releases."

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