Blackpink Contract Tango Stock Market: In the fast-paced world of K-pop, groups rise and fade away like shooting stars. Most contract renewals happen quietly, but not for Blackpink, a powerhouse in the realm of girl groups.
When the time came for Blackpink members to extend their contracts, chaos ensued in the stock market for their label, YG Entertainment.
In September, shares of the Kosdaq-listed YG Entertainment experienced dramatic dips on two occasions. The entertainment group saw a 9% fall on Sept. 14 and a staggering 13% drop on Sept. 21 following reports that three members wouldn’t renew their contracts.
Yet, despite the tumult, YGs stock has seen a rise this year, boasting a year-to-date gain of 23.38% as of Nov. 21.
Recently, South Korean outlet Munhwa Ilbo disclosed that individual members wouldn’t renew exclusive contracts with YG. However, the group is set to continue its activities as Blackpink under the label. YG’s shares saw about a 3% uptick with this revelation.
Analysts are divided on these recent events. Samsung Securities senior analyst Minha Choi trimmed the target price for YG Entertainment by 9.5% to 76,000 won, signifying a 41% upside from Tuesdays close.
Choi expressed concern in a Nov. 14 note, stating, Three months have passed since Blackpink members contract expired in August. But there has been no official announcement about the contract renewal. The uncertainty is weighing on shares.
However, given that members Jennie and Rosé released material under YG in October and November, Choi assumes the contract renewal is factored into his current valuation, though he remains “conservative about the number of the groups activities.”
The upcoming debut of the new girl group Babymonster on Nov. 27 could act as a growth driver for the company, according to Choi.
Yet, he points out that YG has relied too much on a few artists while its rivals have reinforced their artist lineups.
On the flip side, NH Investment and Securities maintained their buy rating and target price of 87,000 won on the stock, indicating an upside of more than 60%.
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Analysts Hazell Lee and Seungjun Lee stated in a Nov. 14 report that the firms current share price has accounted for all major risk factors, including artist departure, easing earnings uncertainty for YG.
Blackpink stands as one of YGs most successful acts. The girl groups recent world tour attracted 2.11 million people globally, covering 66 performances in 34 cities.
Blackpink achieved several milestones, headlining the Coachella festival in the U.S. and the BST Hyde Park festival in the U.K., making them the first Asian act and K-pop girl group to do so.
They topped the Billboard 200 and hold the Guinness World Record for the most-viewed music channel on YouTube for a group.
The seven-year curse looms large for K-pop groups, as standardized seven-year contracts often lead to disbandment. Media questioned if Blackpink could survive this curse. A successful departure could mean a substantial loss for the company due to the high cost of training and debuting a new group.
Reports suggest the cost of creating a girl group can range between 2 billion won and 5 billion won (about $1.55 million to $3.89 million). This includes three years of training, estimated at 3.18 billion South Korean won, or just over $2.47 million.
Bokyung Suh, director and senior research analyst at Bernstein, highlighted the unpredictable nature of the entertainment business, stating, We know that entertainment is often considered a lottery business… this is why global leading entertainment players try to diversify their IP portfolio to run their business more sustainably.
Our Reader’s Queries
Did Blackpink renew their contract 2024?
On November 22, 2023, Lisa, Rosé, Jisoo, and Jennie from Blackpink were honored as members of the Order of the British Empire in London. The K-pop supergroup’s four members have recently renewed their contracts with YG Entertainment, as per the label’s regulatory filing published on Wednesday.
Did Blackpink not renew their contract?
YG Entertainment has confirmed that BLACKPINK has extended their group contract with the company. However, there will be no further contracts for individual activities for the members.
Does Blackpink have a 7 year contract?
Blackpink’s Jennie, Lisa, Rose, and Jisoo are set to defy K-pop’s notorious “seven-year curse” as they remain together as a group. Despite the industry’s history of disbanding groups after seven years, Blackpink is determined to continue their success and stay united. The quartet’s commitment to their music and fans is a testament to their talent and dedication. Fans can look forward to more amazing performances and music from Blackpink in the years to come.
Is Blackpink still under YG?
As of Friday, December 29 at 7:15 p.m., Blackpink remains under YG Entertainment’s umbrella, but the individual members have decided not to renew their contracts with the company. Despite previously renewing their group contract, Jennie, Jisoo, Lisa, and Rosé have opted out of signing new individual contracts with YG.