[Click eStock] YG Entertainment, from BLACKPINK to GD and BabyMonster

NH Investment & Securities Report

[Asia Economy Reporter Minji Lee] NH Investment & Securities maintained a buy rating and a target price of 77,000 KRW for YG Entertainment on the 19th. Although uncertainties remain regarding BLACKPINK's contract renewal, the launch of a new girl group and GD's solo activities are expected to drive the stock price upward.

[Image source=Yonhap News]

Since the resolution of issues related to Yang Hyun-suk at the end of December last year, YG Entertainment has been accelerating its overall business operations. The company is streamlining some artist lineups and intensifying its artist-centered business approach. In early January, a teaser for the new girl group Baby Monster was released, and GD expressed his intention to resume solo activities within the year.

Hwa-jeong Lee, a researcher at NH Investment & Securities, explained, "For Baby Monster, performance teaser videos of the members have been released weekly, and public response so far has been favorable," adding, "With the addition of GD's support, dependence on a single artist will be alleviated."

Although the stock price is undervalued due to the BLACKPINK contract renewal issue, there seems to be no need to preemptively consider negative factors. BLACKPINK's contract expires in August this year. Researcher Lee stated, "Considering the mutual benefits for both the artists and the company, it is highly likely that the contract renewal will proceed smoothly," and analyzed, "It is time to set aside excessive concerns."

Fourth-quarter estimated sales are 145.5 billion KRW, and operating profit is 2.3 billion KRW, expected to grow by 64% and 74% respectively compared to the same period last year. This is due to the inclusion of ticket and merchandise revenue related to BLACKPINK's world tour. Revenue from Treasure's Japan tour is also expected to be recognized.

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