Kiwoom Securities said on the 2nd that Com2uS(078340)'s new title "Zeus: God of pride" is showing initial sales performance exceeding prior estimates, but it noted that the sustainability of sales should be watched. It maintained its "Buy" investment opinion and raised the target price to 50,000 won from 47,000 won. Com2uS closed at 34,500 won the previous day.
Kim Jin-gu, a Kiwoom Securities researcher, said the new 50,000 won target price reflects the present value for this year, applying a price-to-earnings ratio (PER) of 12.5 times to next year's 53.3 billion won in net profit attributable to owners of the parent and a 10% discount rate.
Kim said, "We kept the valuation reference point at next year, when the full contribution of the major new release 'Zeus: God of pride' will be normalized and reflected."
Kiwoom Securities projected average daily sales for the initial quarter of "Zeus: God of pride" at 1.5 billion won in the third quarter this year. It also normalized average daily sales for this year and next year at 960 million won and 470 million won, respectively, and reflected them in its estimates.
Kim said, "This game includes attempts to broaden coverage of mid-level users through step-up packages," adding, "At the same time, the initial business model (BM) stance appears to align with leading-class graphic quality in the competitive massively multiplayer online role-playing game (MMORPG) genre, which we interpret as delivering initial sales performance exceeding prior estimates."
However, it said, "From a midterm business model perspective, including player-versus-player (PvP) balance issues, it is somewhat difficult to judge that the stance is as mild as initially expected," adding, "We additionally reflected a greater downward adjustment for subsequent quarterly normalization phases in our estimates."
Accordingly, the estimated daily sales for the third quarter this year for "Zeus: God of pride" doubled, up 100% from the previous estimate, but the expected daily sales for this year and next year increased 56% and 11%, respectively, from the previous figures, indicating a reduced pace of increase.
Kim added, "Going forward, we believe the extent to which this game practically incorporates its business model stance and management of small- and mid-spending users will determine the level of sustainability for user traffic and sales."