Shift Up's 'KOSPI Debut' Fails to Become a 'Big Catch'... Limitations in Revenue Diversification Are a Weakness

Rising to 89,500 Won During Trading Then Giving Up Gains
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Shift Up's Masterpiece Goddess of Victory: Nikke Poster

Shift Up, a major IPO in the second half of this year, made its debut on the Korea Exchange. Although the public offering subscription rate was as high as 341 to 1, reflecting strong expectations, the stock price increase was limited due to concerns over the revenue structure relying on a few games.

According to the Korea Exchange on the 12th, Shift Up, which was listed on the KOSPI market the previous day, closed trading at 71,000 KRW, up 18.33% from the public offering price of 60,000 KRW. During the day, the stock price rose to as high as 89,500 KRW but gave back gains toward the latter part of the session. Its market capitalization reached 4.1198 trillion KRW, ranking just behind Krafton (13.6005 trillion KRW) as the second largest domestic game company, following Netmarble (5.2689 trillion KRW) and NCSoft (4.1976 trillion KRW).

Before the listing, there was even anticipation that Shift Up’s stock price could double compared to the public offering price. This was because the influence of its intellectual property (IP), notably its flagship title released in 2022, Goddess of Victory: NIKKE, remained strong with rising revenue rankings. According to data from the analytics solution Mobile Index, Goddess of Victory: NIKKE ranked 10th in domestic revenue on the Google Play Market as of the 10th. Although it had dropped to 48th earlier this month, a summer update on the 4th, which included new characters and mini-games, boosted its revenue.

The game’s popularity overseas is also being maintained. On the 10th, it ranked 5th and 21st in revenue on Japan’s Google Play Market and App Store, respectively. Goddess of Victory: NIKKE is a collection-type role-playing game (RPG) with anime-style graphics, belonging to the subculture genre, and it has gained significant popularity even in Japan, which is considered the origin of this genre. It also secured global recognition by ranking 8th on both Taiwan’s and Hong Kong’s Google Play Markets.

Despite these positive evaluations, the stock price increase fell short of expectations because the company’s revenue is heavily concentrated on Goddess of Victory: NIKKE, indicating a lack of diversification in earnings. Although the performance of another game, Stellar Blade, has yet to be reflected, 97% of the revenue depends on Goddess of Victory: NIKKE. Shift Up’s revenue for the first quarter of this year was 37.376 billion KRW, down 16.8% year-on-year, which is attributed to the underperformance of Goddess of Victory: NIKKE.

CEO Kim Hyung-tae seemed aware of the criticism regarding the lack of additional growth momentum, stating at a meeting held last month, “We will ensure that our next title maintains the top position and that the company continues to uphold its success DNA.”

However, the release of new titles is still a long way off. Shift Up plans to invest 101 billion KRW of the funds raised through the listing into the development of Project Witches, but the investment prospectus states that the release is targeted for after 2027.

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