[THE INVESTOR] YG Entertainment will pick up as new artists advance and its new business shows potential, said Mirae Asset Daewoo on Aug. 13, upgrading the recommendation to a “buy” from a “trading buy” and maintaining 43,000 won (US$38.01) target price. 

Its operating profit in the second quarter plunged 67.6 percent on-year to 1.4 billion won and revenue by 13.2 percent to 62.7 billion won. It was the first quarter to reflect the absence of Big Bang and overall figures were slow as expected, but next-generation artists are moving ahead and new business outlook is optimistic, said analyst Park Jeong-yeop.

IKON and Black Pink will hold major concerts in Japan, over 2 years faster than their predecessors, and combined with Winner, their fast advance will bolster the company’s profits for over 3 years at the least. Meanwhile losses from cosmetics and content production are shrinking. Big Bang, like TVXQ! and Super Junior, is likely to stage performances as large as before when they return after serving in the military. 

By Hwang You-mee (glamazon@heraldcorp.com)