For South Korea’s leading mobile game maker, Netmarble, when it rains, it pours.

When it came out with BTS World, a story-based mobile game in which players become BTS’ managers -- responsible for growing the K-pop band and promoting its music -- the market got excited. When Beijing granted licenses to overseas game makers after a 13-month hiatus in April, it also raised investors’ hopes that Netmarble might release new games on the world’s largest market.

And then the mobile game maker was very close to buying its archrival Nexon, which was up for sale by founder Kim Jung-ju, and investors thought the company might be about to get a new growth engine. 

But Nexon withdrew its plan to sell and disappointed investors dumped Netmarble stocks, making it hand over the No. 1 position in terms of market cap among local game making stocks to NCSoft on June 26.

“The reason Netmarble’s price-earnings ratio reached 40 was due to expectations that the Nexon acquisition would be a future growth engine,” said Jung Ho-yoon, an analyst at Korea Investment and Securities.

Netmarble shares, which went public with a price tag of 157,000 won ($13.33) in April 2017, closed at 91,600 won on July 16, down 2.35 percent from the previous day.

Some analysts think the ongoing trade feud between Korea and Japan could take a further toll on Netmarble.

Netmarble’s new game The Seven Deadly Sins was one of the most anticipated games released by the game maker, but Korean users may very well give it the cold shoulder with so many Koreans boycotting Japanese products. The new game is based on the IP of a Japanese fantasy animation.

Coincidentally, the game was the No. 1 grossing game in the Google Play Store on June 4, but fell to No. 8 as of July 16.

Meanwhile, the top-grossing game as of July 16 is NCSoft. Institutional investors also appear bullish about the company. The National Pension Service, the country’s pension fund, raised its stake from 11.12 percent to 12.12 percent in the past month.

NCSoft’s share price was up 0.6 percent and closed at 500,000 won on July 16. On the same day, the market cap of NCSoft and Netmarble stood at 10.97 trillion won and 7.85 trillion won, respectively.

By Park Ga-young (gypark@heraldcorp.com)