On the 3rd, DB Securities projected that Kakao would benefit from the new government's expectations for fostering the artificial intelligence (AI) industry. Consequently, it raised its target price from the previous 49,000 won to 77,000 won, an increase of approximately 57.1%. On the previous trading day, Kakao closed at 58,700 won.
According to DB Securities, Kakao is expected to revamp KakaoTalk and apply AI from September to October through the end of the year. Shin Eun-jeong, a researcher at DB Securities, noted that a joint service with OpenAI will become evident, adding that if high-quality content supply in video and short-form formats proceeds smoothly after the KakaoTalk revamp, traffic and new advertising revenue increases can be expected.
He further added, "AI services are expected to allow connections with Kakao affiliates and external applications (apps) using an agent within the talk, and a revenue structure from B2C (business-to-consumer) utilizing ChatGPT could also be anticipated."
Additionally, Kakao's revenue in the second quarter of this year is projected to decrease by 0.8% year-on-year to 1.9983 trillion won, while operating profit is expected to increase by 1.6% to 136.1 billion won. This figure exceeds market expectations. The TalkBiz advertising sector is expected to grow by 5.9% compared to the previous year.
Researcher Shin noted, "While policies have not been clearly established yet, it is anticipated that Kakao Group, with its structure of payment, banking, and securities, will sufficiently benefit from stablecoins," adding that the upward adjustment of the target price reflects the stabilization of performance in the core business due to AI policies and the increase in the equity value of subsidiaries related to stablecoins.