BTS has made Billboard history
Members of the K-pop band BTS are expected to become multimillionaire shareholders of their label, Big Hit Entertainment, as it prepares an initial public offering (IPO) which could top out at $811 million or 962.6 won. The offering would give each member 9.23 billion won of shares, or 64.6 billion won altogether, should it be priced at the top of its range in October, according to Reuters.
Analysts predict the pricing could potentially value the company at $4.04 billion or 4.8 trillion won, when factoring convertible preferred stocks and common shares. Big Hit plans to offer about 7.1 million shares at an indicative price range of 105,000-135,000 won per share.
“The stock could perform well upon listing, as there’s a lot of liquidity in the market now… Then it depends on Big Hit’s results, but the lack of physical concerts due to COVID-19 will likely have negative impact,” says Nam Hyo-ji, analyst at KTB Investment and Securities.
Big Hit relies heavily on BTS, which made history as their mega-hit “Dynamite” debuted at the top of Billboard’s Hot 100 songs chart, a first for a Korean act. The English-language single spends its second week at No. 1 this week, marking the 20th of 43 songs that have entered the Hot 100 at No. 1 all-time to remain on top during its second week. The music video reached new heights on YouTube, amassing 101.1 million views within 24 hours after its release and garnering over three million peak concurrent viewers immediately upon release.
The K-pop superstars have earned the label 87.7% and 97.4% of its revenue in the first half of 2020 and 2019, respectively.
Big Hit CEO and largest shareholder Bang Si-hyuk gave 478,695 common shares to the seven BTS members, or 68,385 per each, last monght “to strengthen long-term partnership with major artists and boost morale,” the label says in the filing.
Analyst Kim Hyun-yong with eBEST Investments & Securities suggests the stock gift may be interpreted to bind the seven piece boy band and the label more closely together.
The label is working to address concerns to adjust its revenue streams as the BTS members enter mandatory military age in South Korea in the coming years. “There is the military issue, but if there is no legal exemption, Big Hit is expected to either set up units with the remaining members or pursue solo acts while they serve in the military,” Hyun-yong shares.
BTS’s fourth film, Break The Silence: The Movie, was set to be released in limited theaters beginning September 10th in Korea, but has been postponed due to the latest COVID-19 outbreak in Seoul. A new Korean premiere date will be announced by the end of September once the situation is more stabilized. Additional screenings begin September 24th with dates varying per territory and subject to change based on the status of local cinema re-openings due to the pandemic.
The group also just dropped a free single in partnership with Hyundai. The track, “IONIQ: I’m On It,” incorporates the now quintessential shape-shifting pop sound of BTS with slick and catchy melodies, while the reflective lyrics aide in exploring the individual moments fans can experience with Hyundai’s new EV brand, IONIQ.
