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K-pop boy band BTS has climbed to the top of US Billboard charts and is in the middle of a sell-out world tour. But other K-pop stars are finding it harder to reach global stardom in a crowded field.
The US$4.7 billion (S$6.5 billion) K-pop industry is one of South Korea’s largest cultural exports, and the talent agencies were among the best stock performers in Asia this year.
That climb came crashing yesterday after Hana Financial Investment analyst Kihoon Lee said new bands may not be as successful as recent groups.
He lowered his third-quarter operating profit estimate for JYP Entertainment by 20 per cent, citing higher production costs and lower-than-expected revenue from fan-meeting events.
Shares of JYP, the agency behind girl group Twice, slid a record 20 per cent in Seoul yesterday. That spurred declines in other agencies too.
“The downgrade in the analyst’s estimates is sparking a sell-off by investors,” said DB Asset Management head of equities Lee Seung Hoon in Seoul. “The sector was the only one in Korea’s stock market that rallied despite the recent rout.”
YG Entertainment, manager of girl group Black Pink, fell as much as 12 per cent, while SM Entertainment dropped by up to 15 per cent. The declines were the worst for the stocks since at least 2012.
BTS is represented by privately held Big Hit Entertainment.
BLOOMBERG
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