16
In the wake of the highly anticipated debut of YG Entertainment’s latest endeavor, BABYMONSTER, on November 27th, financial dynamics within the entertainment giant underwent a shift as reports suggested that Yuanta Securities decided to lower the target stock price for YG from 75,000 to 65,000 won.
The adjustment was based on an analysis by Yuanta Securities analyst Lee Hwan-wook, who highlighted a projected decrease in YG’s expected sales and operating profit for the coming year and told kbizoom, “Next year’s expected sales and operating profit of YG are projected to decrease by 32.7% and 51.5% compared to the previous year, amounting to 369.3 billion won and 46.1 billion won, respectively. Excluding YG’s representative artist IP BLACKPINK, a downturn compared to the previous year is inevitable. ” Lee elucidated the projected landscape, stating, “Next year, the combined album sales of YG-affiliated K-pop IPs are expected to decrease by 18.7% compared to the previous year, reaching 4.26 million units. The sales of BABYMONSTER are expected to partially offset BLACKPINK’s hiatus”. He further added, “YG’s performance growth in the streaming sector in 2024 will either slightly increase by 0.5% or show stability compared to the previous year. However, the annual total number of recruits is expected to be around 600,000, resulting in a significant decrease of 73.0% to around 29.5 billion won in revenue compared to the previous year.”
Despite the downward revision in the target stock price, Yuanta Securities maintained a ‘buy’ investment opinion for YG Entertainment. Lee justified this stance by underlining the foundational strength of YG, boasting over 100 billion won per quarter, and acknowledging BABYMONSTER’s burgeoning global popularity and growth potential.
BABYMONSTER’s debut certainly made waves, securing the top spot on the worldwide YouTube chart for two consecutive days with their debut single ‘BATTER UP’. Their success extended to the music video charts in the US and the UK, where they entered the top 3 and top 7, respectively.
BLACKPINK debuted in 2016 with members Jisoo, Jennie, Rosé, and Lisa. YG Entertainment is yet to announce renewal of their contract which ended in August this year.
The adjustment was based on an analysis by Yuanta Securities analyst Lee Hwan-wook, who highlighted a projected decrease in YG’s expected sales and operating profit for the coming year and told kbizoom, “Next year’s expected sales and operating profit of YG are projected to decrease by 32.7% and 51.5% compared to the previous year, amounting to 369.3 billion won and 46.1 billion won, respectively. Excluding YG’s representative artist IP BLACKPINK, a downturn compared to the previous year is inevitable. ” Lee elucidated the projected landscape, stating, “Next year, the combined album sales of YG-affiliated K-pop IPs are expected to decrease by 18.7% compared to the previous year, reaching 4.26 million units. The sales of BABYMONSTER are expected to partially offset BLACKPINK’s hiatus”. He further added, “YG’s performance growth in the streaming sector in 2024 will either slightly increase by 0.5% or show stability compared to the previous year. However, the annual total number of recruits is expected to be around 600,000, resulting in a significant decrease of 73.0% to around 29.5 billion won in revenue compared to the previous year.”
Despite the downward revision in the target stock price, Yuanta Securities maintained a ‘buy’ investment opinion for YG Entertainment. Lee justified this stance by underlining the foundational strength of YG, boasting over 100 billion won per quarter, and acknowledging BABYMONSTER’s burgeoning global popularity and growth potential.
BABYMONSTER’s debut certainly made waves, securing the top spot on the worldwide YouTube chart for two consecutive days with their debut single ‘BATTER UP’. Their success extended to the music video charts in the US and the UK, where they entered the top 3 and top 7, respectively.
BLACKPINK debuted in 2016 with members Jisoo, Jennie, Rosé, and Lisa. YG Entertainment is yet to announce renewal of their contract which ended in August this year.
