[Culture &] YG Entertainment’s Target Price of 87,000 Won Set on “BIGBANG’s Global Tour in the Second Half”

Korea Investment & Securities said it is raising expectations for BIGBANG’s comeback and a global tour in the second half, and on the 24th presented an investment view of “Buy” and a target price of 87,000 won. The target price was calculated by applying 12 months of forward-looking operating profit of 65.7 billion won and a price-earnings ratio (PER) of 25x.

◆ BIGBANG and BLACKPINK make a dazzling return with key IP

Despite uncertainties in YG Entertainment’s earnings this year, Jeong Hoyoon, a researcher at Korea Investment & Securities, focused on the return of key intellectual property (IP) that previously drove growth. This comes after BLACKPINK resumed activities on February 27, and in the second half, BIGBANG is expected to make a full-scale comeback.

In particular, BIGBANG will return to the public through the Coachella stage, the United States’ largest music festival, in April. Jeong analyzed, “After the return, the recent official announcement by CEO Yang Hyun-seok suggests that the global tour will be carried out in the second half. Specific dates or regions have not been finalized, but from the second half onward, it is expected to make a meaningful contribution to earnings.”

◆ Building mid- to long-term growth momentum by strengthening the lineup of younger artists

Along with the return of major artists, the rising performance of rookie-level acts is also seen as a positive factor. Babymonster and TREASURE , among younger artists, are showing an upward trend as they expand their global fandom.

Jeong forecast, “By strengthening the younger-artist lineup, we should be able to see YG Entertainment not only improve short-term earnings this year, but also secure growth potential over the mid to long term at the same time.”