HYBE, the beloved label of BTS, saw a sudden descent in stock price after the septet announced a temporary break to focus on individual growth. In the first hour of trading, the shares of HYBE, a South Korean entertainment agency, dropped by 28% as BTS presses paused.
A Billboard report says that HYBE shares have fallen as far as ₩140 thousand per share after opening at ₩168 thousand. The company is approaching its lowest closing since becoming public in 2020. It has swept a market value of $1.7 million.
However, BTS’s decision has caused HYBE stock to drop by up to 60% in 2022. It indicates that the company has lost almost all its gains since going public.
Lee Hye-in, an analyst at Yuanta Securities Korea Co., says that the company may see a substantial drop in its profit and sales projections for 2022 and 2023. Moreover, their revenue maybe 25% lower than anticipated if HYBE confirms that BTS will not continue live performances for the rest of the year. Meanwhile, it could see a 33% reduction in profit.
Meanwhile, Lee Ki-hun, an analyst at Hana Financial Investment, predicts that it might be an indirect way of expressing [the need to] join the military. “Their 2022 earnings might be little offset. There is a possibility that the members may release at least one last solo album this year and might join the army in 2023,” Lee added.
However, the compulsory military service of South Korea does not apply to BTS. Hwang Hee, South Korean Minister of Culture, Sports, and Tourism, requested the same in early 2022. During a press conference, he suggested that the internationally recognised K-pop artists must be opted out of their required two-year conscription in favor of alternative programs.