[MarketING] Entertainment Stocks Gain Momentum Amid K-pop Popularity

KOSPI Closes Higher for 7th Consecutive Day
KOSDAQ Rises for 3rd Day, Approaching 910 Level

The KOSPI continued its upward trend for the seventh consecutive trading day. The KOSDAQ also rose for the third consecutive day, approaching the 910 level. Recently, entertainment stocks have been strong due to the popularity of K-pop. With continuous inflows of buying from foreigners and institutions, solid earnings are also expected to support the rise in stock prices.

KOSPI Rises for 7 Days... Closes in a Narrowly Positive Range

On the 17th, the KOSPI closed at 2,575.91, up 4.42 points (0.17%) from the previous session. The KOSDAQ ended the day at 909.50, up 5.66 points (0.63%).

[Image source=Yonhap News]

The KOSPI, which started the day lower, turned to an upward trend before the market closed. Similarly, the KOSDAQ, which also began with a decline, successfully reversed to an increase in the morning. Although foreigners and institutions sold off, individual investors bought alone, driving the index higher. On that day, individuals net purchased 384.9 billion KRW in the KOSPI market and 246.2 billion KRW in the KOSDAQ market. Conversely, foreigners and institutions net sold 16.9 billion KRW and 369.7 billion KRW respectively in the KOSPI market, and sold 49.1 billion KRW and 182.7 billion KRW respectively in the KOSDAQ market. Seokhwan Kim, a researcher at Mirae Asset Securities, said, "Despite a weak start to the domestic stock market due to a strong dollar and foreign selling, individual buying inflows turned the index upward. Entertainment stocks showed strength as album sales and concert attendance are expected to reach record highs due to the advancement of K-pop."

On that day, JYP Entertainment (JYP Ent.) closed at 88,300 KRW, up 3.88% from the previous day. During the session, it rose to 89,000 KRW, setting a new 52-week high. It has maintained an upward trend for three consecutive days. With continuous strength, JYP Ent.'s market capitalization surpassed 3 trillion KRW on the 14th and increased to 3.13 trillion KRW on this day. YG Entertainment also reached a new 52-week high during the session at 66,200 KRW. YG Entertainment rose 1.58% that day. HYBE continued its 10-day winning streak, rising 0.39% to recover the 260,000 KRW level. HYBE's stock price reaching the 260,000 KRW level is the first time in about a year since April last year.

With continuous inflows of buying from foreigners and institutions, the stock price strength continues. Since the beginning of this month, foreigners have net purchased HYBE for 120.8 billion KRW, JYP Ent. for 35.6 billion KRW, and YG Ent. for 18.9 billion KRW. Institutions bought HYBE for 67.7 billion KRW and SM Entertainment for 44.4 billion KRW.

The popularity of K-pop appears to be contributing to the strong stock prices. BTS member Jimin, who released a solo album last month, recently ranked first on Billboard's 'Hot 100' and 'Artist 100,' and BLACKPINK's Jisoo's solo title track ranked first for two consecutive weeks on the 'Global YouTube Song Top 100' as of the 16th.

Strong Earnings Lead to Multiple Target Price Upgrades

Expectations for entertainment stocks' earnings are growing due to strong album sales. Accordingly, securities firms have been raising target prices for entertainment stocks one after another.

Hanwha Investment & Securities raised JYP Ent.'s target price from 100,000 KRW to 115,000 KRW on the same day. Sooyoung Park, a researcher at Hanwha Investment & Securities, explained, "JYP Ent.'s first-quarter sales and operating profit are expected to have met market expectations with 101.3 billion KRW and 26.7 billion KRW respectively. As of the 14th, JYP Ent.'s foreign ownership exceeded 43%. Among the four major domestic entertainment companies, it was the first to establish a label system and has built strategic partnerships with major labels in the North American market to expand market share. When evaluated solely on the traditional core competencies of an entertainment agency, it is the most superior."

NH Investment & Securities raised HYBE's target price from 250,000 KRW to 310,000 KRW, and Hyundai Motor Securities raised it by 25% to 300,000 KRW. Hyunyong Kim, a researcher at Hyundai Motor Securities, said, "HYBE is likely to achieve record-high operating profit with 8.24 million albums sold and 780,000 concert attendees in the second quarter. While BTS solo activities steadily fill the activity gap, the entire artist lineup including Seventeen, TXT, NewJeans, and LE SSERAFIM has been consecutively breaking highest sales records since the beginning of the year. The second quarter's SUGA world tour, Seventeen dome fan meeting, and TXT world tour will drive the record-high operating profit."

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