With Pearl Abyss shares plunging sharply before and after the launch of its new title, brokerages moved to curb "debt investing" ("investing with borrowed money") by restricting margin trading and the like. Individuals stepped in to buy as the stock tumbled.
According to the financial investment industry on the 20th, Mirae Asset Securities changed its rating on Pearl Abyss from "E" to "F" and raised the margin rate from 30% to 100% that day. Once classified as an F-group stock, new loan financing and maturity extensions are restricted. Kiwoom Securities also raised the margin rate from 30% to 50%.
The sharp drop in Pearl Abyss shares in a short period significantly increased unsettled risk. If the decline continues, individual investors may be unable to repay borrowed funds, which could directly translate into losses for securities firms.
Pearl Abyss closed at 41,500 won, down 9.78% from the previous session. Following a limit-down (the lower bound of the daily price limit) the day before, it plunged for a second straight day.
The weakness in the share price stems from overseas reviews of the new title "Crimson Desert," which the company has been developing for seven years, being more negative than expected. The day before, global review site Metacritic disclosed a PC Metascore of 78 for Crimson Desert. While the graphics and combat dynamism were rated highly, analyses said it lacked in handling and depth.
Until now, Pearl Abyss shares had been rising on expectations ahead of the new release. Anticipation for results grew because the title had been in long-term development and had climbed into the low top-10 of the wishlist rankings on Steam, the PC game platform. On the 10th, it even rose intraday to 72,000 won to hit a one-year high. But the stock fell to the low 40,000-won range that day, plunging more than 40% from the peak in eight trading days.
However, individuals saw this as a buying opportunity at low prices and showed a "buy" stance. On the previous day, when the stock hit the limit-down, individuals made a net purchase of 52.2 billion won of Pearl Abyss shares. That contrasted with institutions and foreigners selling 3.7 billion won and 1.6 billion won, respectively. Individuals also bought 15.4 billion won worth that day.
Brokerage outlooks are mixed. Lim Hee-seok, an analyst at Mirae Asset Securities, said, "Since January, interest in the new title's launch led to a share-price rise, but right after the release of Crimson Desert the momentum (upside potential) will rapidly dissipate." He also noted, "After Crimson Desert, the next title 'DokeV' will need at least two years to launch, making a new-release gap until 2027 unavoidable," and gave an investment opinion of "sell."
Conversely, Choi Seung-ho, an analyst at DS Investment & Securities, analyzed, "Crimson Desert, by the indicators alone, is not meeting the market's expectations, but if it proves strong quality and mass appeal, follow-up sales could increase significantly." He then raised the target price for Pearl Abyss from 43,000 won to 65,000 won.