[Click e-Stock] "Growth Driven by PUBG"... Target Price Raised by 40,000 Won for This Stock

Kiwoom Securities has raised its target price for Krafton from 300,000 won to 340,000 won. The investment rating remains at Outperform.

On May 7, analyst Kim Jingu of Kiwoom Securities stated, "We applied a target price-to-earnings ratio (PER) of 12.5 times to this year's controlling shareholder net profit of 1.2551 trillion won."

He added, "We have revised earnings upward compared to previous estimates, taking into account the above-neutral profit-generating capacity of the PUBG intellectual property (IP) developed by PUBG Studios. However, we have also comprehensively reflected the risks of concentration on a single IP, intensified competition from rival companies entering the same genre, and the potential for natural decline, leading us to lower the target multiple to 12.5 times."

Revenues from PUBG Studios, the developer of PUBG, and Peacekeeper Elite are expected to continue increasing. Kim projected a year-on-year growth rate of 17.3% for PUBG's PC-based revenue and 187% for mobile revenue in 2026. However, he also pointed out, "There is significant reliance on the PUBG-based IP in the game portfolio, and the performance of multiple new titles based on global mega IPs has yet to become visibly apparent, which could increase future earnings volatility."

IP diversification remains a key challenge for Krafton. Kim noted, "Krafton demonstrated its commitment to IP diversification this year by releasing progress updates on Project Windless." He further stated, "New titles will need to prove their content quality, and if the response is positive, a valuation multiple expansion will be possible. The company must establish a foundation for multiple IPs by developing new titles for each major IP in order to level up its corporate value."

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