Report

Kakao (035720.KS):Fostering The Growth Of New Businesses

  •  We saw growth across all divisions in 1Q18, which resulted in sharp top-line growth and record quarterly revenue. However, margins contracted because of labor and marketing cost hikes related to new businesses.

  • -  Movements to facilitate the growth of Kakao platforms will continue through 2018. In addition to movements to bring about the advancement of the ad platform, there will be more concrete efforts to bolster the growth of Kakao Bank, Kakao Mobility, and Kakao Pay. Cost increases related to these efforts are inevitable for the time being.

  • -  Kakao is expected to seek investment opportunities to secure future growth engines, using the KRW1tn raised through recent GDR offering.

Underlying
Kakao Corp.

Kakao is engaged in the provision of Internet services to its users and advertisers. Co. provides its owned and operated online properties and services for its users. Co. provides a range of tools and marketing services designed to enable businesses to reach its users for its advertisers.

Provider
Hyundai Motor Investment & Securities
Hyundai Motor Investment & Securities

Hyundai Motor Investment & Securities is the investment banking arm of the Hyundai Motor Group. The company offers stock brokerage and advisory services; derivative products brokerage and advisory services; wrap account portfolio management services; and VIP wealth management and tax planning, institutional equities, derivatives, and futures brokerage services, as well as sells investment and institutional products. It also provides equity offering, ABS, real estate PF and real estate PF securitization, offshore SOC, structured financing, asset securitization, real estate sales, IPO advisory, and private equity fund and fund management services; and CMA/RP portfolio management and fixed income based investments, as well as involved in the issuance, management, and brokerage of OTC derivatives. In addition, the company offers research services, including macro economic forecasts and stock market outlook, industry overviews and forecasts, fixed income strategies, corporate credit analysis, and valuation analysis. Further, it offers a range of retirement and pension services for individuals and corporate members; portfolios and asset allocation consulting and marketing services; proposing retirement pension plans; contract and payment management services; pension plan advisory and actuarial services; and system development and implementation services, as well as operates call centers for retirement pension services, etc. 

Analysts
Sung Jin Hwang

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