Krafton (259960.KS): Valuation reset reflects single-IP discount, but single-digit P/E looks overdone; TP lowered to W30k; stay Buy

Research evidence excerpt

Krafton (259960.KS): Valuation reset reflects single-IP discount, but single-digit P/E looks overdone; TP lowered to W30k; stay Buy

Goldman Sachs Krafton (259960.KS)

moderate growth (+4% YoY) despite seasonality.

n Subnautica 2 performance exceeded our expectations: Subnautica 2 exceeded

4mn unit sales within five days of early access debut. Based on this, we raise our

estimate for the title’s first 12-months unit sales to 7.3mn (previously 1.5mn), which

translates to first 12-months grossing revenue of c.W330bn (vs. our previous

estimate of W90bn).

n Key numbers to track (thesis pillars):

o PUBG franchise durability: PUBG PC Steam concurrent users, PUBG mobile

grossing rankings in key countries, third-party data on PUBG

mobile/Peacekeeper’s monetization and engagement.

o Gamescom pipeline visibility: New title announcements, gameplay

showcase/teaser viewerships, launch windows, beta schedules and

management commentary.

o Portfolio diversification: Contribution from non-PUBG titles as a percentage

of total operating profit over time.

Introducing a new Games valuation framework based on global peers’ earnings quality

We revisit our valuation framework for Online Games, introducing a new framework

based on global peers’ earnings quality. By anchoring our baseline at the global games

peer median of 18x 2027E P/E, we systematically map peer target multiples based on

three core pillars: 1) future pipeline quality and IP diversification for LT earnings

sustainability, 2) geographic reach, and 3) near-term earnings visibility.

Under our updated framework, we prioritize future pipeline quality and IP diversification

as the definitive gatekeeper for structural premium valuations, while treating geographic

reach as a flexible asset rather than a rigid constraint.