[Click eStock] "DearU, Focus on KakaoTalk Gift and Japan JV Growth"

Sangsangin Securities analyzed on the 19th that Dear U is expanding its potential for performance upside through strategic diversification.

Dear U operates a fan communication platform called Dear U Bubble. This platform provides a subscription-based service that allows users to receive artists' messages in one-on-one chat rooms and reply to those messages.

Lee Junho, a researcher at Sangsangin Securities, stated in the report on the same day, "Both stock options and new share subscription rights have been converted into common stock, resolving the overhang issue," and explained, "The remaining risk is the single business model, but this is being addressed by expanding the potential for performance upside through strategic diversification within the existing business model."

The key points to note are the entry into KakaoTalk Gift Shop and the Japanese joint venture (JV). He analyzed, "The entry into KakaoTalk Gift Shop began in February, and it allows gifts to be made through proxy payments for younger consumers or foreign consumers who find direct payment or account linkage difficult, thereby expanding accessibility to a wider range of consumers." He also predicted, "In addition, the commission rate is significantly lower compared to existing Android and iOS platforms, which will contribute to improving operating profit margins."

Furthermore, he stated, "The Japanese JV is expected to open within February, and it is anticipated to bring synergy effects in acquiring Japanese artist IP and business," adding, "It is a JV with M-UP Holdings, and Fanplus, a subsidiary within M-UP Holdings, operates platforms related to artists and fan clubs."

He continued, "When collaborating with the JV, the fact that Fanplus has over 2 million paid subscription members means meaningful references can be accumulated," and forecasted, "Moreover, the structure recognizes a portion of the JV's total sales as Dear U's sales, and since there is no recognition of selling and administrative expenses on these sales, operating profit is expected to improve."

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