The Korea Herald


[Kosdaq Star] Twice’s comeback helps buoy JYP shares

This is the 27th in a series of articles analyzing major companies by market capitalization traded on the tech-heavy Kosdaq market. -- Ed

By 김보경

Published : Oct. 24, 2016 - 17:20

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Buoyed by seven songs topping an online K-pop chart over the weekend, JYP Entertainment’s stock price on the Kosdaq rose nearly 10 percent for the past one month, according to data from Korea Exchange.

JYP, led by veteran musician Park Jin-young, is relatively small in terms of company size compared to its archrivals S.M. Entertainment and YG Entertainment, but it is definitely full of growth potential --especially next year, local securities analysts say. 

(JYP Entertainment) (JYP Entertainment)

Bigger players S.M. and YG have been suffering from negative impact in the Chinese market due to the Korean government’s decision to deploy an advanced US missile defense system in July, with their stock prices still going downhill.

Helping push JYP forward is one of its K-pop groups, Twice, whose new track “TT” seized the No. 1 spot on music charts Monday. Upon the release of the new EP album “TWICEcoaster: LANE1,” the lead single “TT” had topped real-time charts of eight major music websites, including MelON, Mnet, Bugs Music and Genie, as of 7 a.m.

The company’s shares closed at 5,520 won on Monday, up 0.36 percent from the previous trading session.

The trend is expected to continue for JYP next year, driven by the popularity of K-pop groups GOT7, Twice and 2PM, which will be holding concerts in Tokyo.

According to market estimates, JYP outperformed in the first half of this year compared to the same period last year. It is forecast to achieve 8 billion won ($7.06 million) to 9 billion won by the end of this year, more than double the 4.2 billion won in 2015.

“It is worthy paying attention to growth of Twice, which has released three albums in less than a year,” said Lee Ki-hoon, an analyst at Hana Financial Investment. “Twice marked the highest in sales of albums among similar girl groups, selling 140,000 albums in its first year, only second to Girls’ Generation.”

Throughout the first six months of the year, Twice came in sixth in the overall rankings of music streaming sites, solidifying its position as a popular K-pop group, the analyst said.

Until two members of 2PM, Taecyeon and Jun. K, join the army next year, 2PM or its members are expected to ramp up their activities, driving their agency’s expansion.

In terms of accumulated sales of concert tickets, GOT7 has started to outstrip 2PM based on its high popularity among global fans, the analyst noted. The seven boy-member group is helping to spread JYP’s reputation outside the country.

As for the tricky Chinese market, JYP is also making inroads with a new audition program next year featuring its CEO Park and flagship artists. The show is raising expectations on accelerating profitability of the showbiz firm.

“The plan represents JYP’s strong will in the Chinese market and is forecast to help localize the company in the market at a fast rate,” Lee said.

Founded in 1996, the entertainment agency currently produces albums for 15 active artist groups, including Wonder Girls, MissA and 2AM, and supports individual members’ showbiz activities. The CEO, a well-known singer and producer, writes songs for artists under other agencies, contributing to the firm’s profit model that is comprised of revenue from album sales or songs. 

By Song Su-hyun (