HYBE recorded the highest market value in the history of the entertainment industry thanks to BTS: 10 times more than SM, YG and JYP

Let’s see how much is the estimated market capitalization of the 4 biggest Korean entertainment companies HYBE, SM, YG, and JYP.

Out of the top 4 K-pop entertainment companies SM, YG, JYP, and HYBE, which one do you think has the highest market capitalization?  On June 16, experts from the entertainment industries and the Korean Exchange revealed the market capitalization of all four companies.  In particular, HYBE (formerly Big Hit) topped the chart as expected.  However, the number they achieved is even beyond the imagination of many people when it is 10 times higher than the group of Big 3 companies.

Market capitalization is equal to the share price multiplied by the number of shares outstanding. Since outstanding stock is bought and sold in public markets, capitalization could be used as an indicator of public opinion of a company’s net worth and is a determining factor in some forms of stock valuation.

HYBE’s market capitalization reached the highest level in the history of entertainment companies

According to data presented by Chosun Biz, the market capitalization of HYBE Corporation has exceeded 10.2 trillion won as of June 15. As a result, the company currently holds the highest market capitalization among the biggest entertainment companies, 10 times higher than SM, YG and JYP.

More specifically, this is the first time in the history of the entertainment industry that a company has reached a market value of 10 trillion won.  According to financial analysts, HYBE’s market value is so high thanks to the constant popularity of BTS. The group is currently dominating music charts around the world with its 3-week No.1 on Billboard Hot 100 with ‘Butter’.

“Once BTS continues to tour, HYBE could hit a quarterly operating profit of around 100 billion won from offline and online events.”

Lee Gi-Hoon, an analyst at Hana Financial Investment

This prediction is based on revenue from BTS’ previous online events.  BTS’ most recent fanmeeting ‘Muster Sowoozoo 2021’ also attracted 1.33 million views and ticket sales estimated at 79.1 billion won.

“From the online fan meeting on June 13 and 14, BTS is likely to have at least two more online concerts in the second half of this year. Considering the growing number of concertgoers, HYBE can easily achieve sales of at least 20 billion won from ticket sales alone.”

Analyst Lee Hyun Ji of Engene Investment and Securities

HYBE’s revenue grew 29.9 percent year-on-year to 178.3 billion won in the first quarter and operating profit reached 21.7 billion won, up 9% year-on-year.

The market capitalization of SM, JYP and YG also shows positive results. 

All 3 companies in the Big 3 have a market capitalization of about 1 trillion won.  Based on market prices after the June 15 close, SM recorded a value of 1.196 trillion won.  JYP’s is 1.466 trillion won.  Meanwhile, YG holds a market capitalization of 965.9 billion won.

Thus, the ranking of 4 entertainment companies by current market capitalization is as follows:

  1. HYBE – 10.2 trillion won
  2. SM – 1.196 trillion won
  3. JYP – 1.466 trillion won
  4. YG – 965.9 billion won

In fact, in May, the Korean Exchange announced that SM and YG had been demoted to mid-tier businesses.  According to the operator of South Korea’s only stock exchange, the reason for the downgrade was the companies’ poor financial performance.

However, based on a recent report by Korea Securities Dealers Automated Quotation System (KOSDAQ) on May 28, entertainment companies all showed a significant increase in their trading market activity following consecutive product releases from each company. KOSDAQ also mentioned the increase in the commercial value of SM and YG following the comeback of EXO and TWICE this June.

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