Samsung Securities said on the 30th that while results from the existing hit title Battlegrounds (PUBG) are expected, the release of this year's next title remains highly uncertain. It maintained its Buy rating and raised the target price to 310,000 won from 300,000 won. Krafton's closing price in the previous trading day was 254,500 won.
Oh Dong-hwan, an analyst at Samsung Securities, said, "A large-scale update for PUBG, which marked its ninth anniversary, went live on Mar. 10, leading to a rebound in traffic and revenue across all platforms," and added, "Peacekeeper Elite (China version) also climbed to No. 1 in revenue rankings thanks to the Lunar New Year and Ferrari collaboration effects."
PUBG on Steam temporarily reached 1.3 million peak concurrent users, the level of March last year, and is still maintaining peak concurrency in the 800,000 range. In particular, PUBG's first-quarter revenue this year increased year over year across all platforms, and, accordingly, first-quarter operating profit is projected to rebound to the 400 billion won range.
Oh said, "According to the new update roadmap, PUBG plans to add tactical depth this year by introducing a terrain destruction system and to roll out various well-made modes that can expand the gameplay experience," and added, "For collaborations, it plans to broaden partnerships with game and animation intellectual property such as Stellar Blade to drive revenue growth."
However, despite PUBG's growth, the company expects limited box office performance for new titles this year.
Samsung Securities said Krafton is pursuing the release of Subnautica 2 within the year while it is engaged in legal action with former management at Unknown Worlds, but as noise around the release escalates, uncertainty over success is growing.
Oh said, "For a full-fledged rise in valuation, the company needs to unveil a new lineup that can become a second PUBG," and added, "Until valuation rises, the share price is expected to climb gradually in line with PUBG's profit growth."