KB Securities announced on May 21 that it has initiated coverage of NC with a target price of 440,000 won, citing expectations for continued success of new game launches, improved profitability, and momentum for global market expansion.
Lee Ji-eun, a researcher at KB Securities, stated, "We present NC as our top pick in the gaming sector, highlighting key investment points such as performance growth driven by consecutive successful game launches, profitability improvements through cost efficiency, global market expansion momentum, and attractive valuation compared to competitors."
KB Securities forecasts NC's operating profit for this year to reach 500.6 billion won, a staggering 3,012% increase from the previous year. The firm believes that the sustained success of 'Aion 2' and 'Lineage Classic' indicates that NC is entering a significant phase of performance improvement. Both games are expected to maintain stable traffic and revenue streams, suggesting strong results for the second quarter following a solid first quarter.
Particularly, 'Aion 2' is noted not only for its commercial success but also for significant changes in user perception. The development team's ongoing communication broadcasts have successfully restored user trust, fostering a positive community atmosphere.
The increase in the proportion of in-game purchases for mobile games is also seen as contributing to profitability improvements. KB Securities estimates that the in-game purchase ratio for 'Aion 2' is about 80%, while the three 'Lineage' mobile games are around 30%. Notably, the in-game purchase ratios for the 'Lineage' mobile games are gradually rising.
Additionally, the upcoming global launch of 'Aion 2' in September is identified as a key momentum factor. Given that the current publishing regions are primarily South Korea and Taiwan, a successful global launch could lead to a reevaluation of NC's valuation.
The researcher concluded, "Despite possessing both performance and new game momentum, NC is undervalued compared to competitors lacking such momentum. We strongly recommend buying and maintain our top pick status."
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.