Bloomberg News

NCsoft, NHN Shares Slump on Regulation Speculation: Seoul Mover

December 20, 2012

NCsoft Corp. (036570) led South Korean gamemaker shares lower in Seoul stock trading on speculation the government will continue to regulate the industry.

NCsoft, a producer of online games, slumped 6.1 percent to 147,500 won, its steepest drop since Dec. 5. NHN Corp. (035420), the country’s biggest Internet search-engine operator, declined 6.3 percent to 216,500 won. Gamevil Inc. (063080) tumbled 14 percent to 90,300 won, the biggest loss since Aug. 19, 2011, while Neowiz Games Corp. (095660) sank 7.7 percent to 22,250 won, the lowest close since Dec. 7. The benchmark Kospi index added 0.3 percent.

Park Geun Hye, South Korea’s newly elected president, was reported by MoneyToday on Dec. 5 as supporting a shutdown system for mobile games, which would would prevent students from playing games after midnight. Park, 60, of the ruling New Frontier Party, defeated main opposition nominee Moon Jae In in yesterday’s election.

“Investors are betting the current government’s regulatory pressure on the game industry will continue after Park’s victory,” Choi Hoon, an analyst at KB Investment & Securities Co., said by phone today.

NHN shares still “seem expensive,” while there are some concerns the company may struggle to succeed in the mobile game business overseas, Jeong Woo Cheol, an analyst at Mirae Asset Securities Co., said today.

To contact the reporter on this story: Saeromi Shin in Seoul at sshin15@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net


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