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Analysts predict Netmarble to gain 27% from IPO price and join Kospi 200

2017.05.08 13:43:18 | 2017.05.09 13:27:32
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Domestic analysts predict shares of South Korea’s top mobile game company Netmarble Games Corp. debuting on Friday in the market’s second largest-ever initial public offering (IPO) could go up as high as 200,000 won apiece.

Shares of Netmarble will go listed at IPO price of 157,000 won, set at the top end of the guidance band amid overwhelming demand. Retail investors showed strong appetite for the shares, resulting in an oversubscription rate of 29.17 times. The IPO will make the game developer 2.66 trillion won richer.

Local brokerage house Mirae Asset Daewoo Co. estimate the shares could gain 27 percent from their debut price to 200,000 won, predicting the company’s operating profit for this year to surge 130 percent from the previous year to 678 billion won and sales 58 percent to 2.37 trillion won.

The rosy outlook is driven by the company’s new game Lineage 2: Revolution that has been enjoying worldwide popularity. The game has been ranked at the top since its release in December last year, and will be released in Japan and China in the second half. Netmarble plans to launch 17 new games this year.

Cash-rich Netmarble is expected to go aggressive in mergers and acquisitions. It can comfortably secure up to 5 trillion won from the stock market and lenders, industry experts say.

Strong earnings, extended lifespan of mobile games, and diverse portfolio support the upside for the stock, said Moon Ji-hyun from Mirae Asset Daewoo, estimating the stock to join the top 200 index soon after debut.

By Chun Gyung-woon

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]

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