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WSJ reports growth potential of Naver`s chat app Line

Posted April. 24, 2014 01:57,   


The global potential of Line, a mobile messaging service owned by Korea`s main online portal Naver, is gaining attention by foreign media. In the New York Stock Exchange, rosy prospects are in ripe for the earnings of Internet companies including Facebook, leading to increasing expectations for the Korean stock markets especially boosted by a potential U.S. initial public offering of Line.

Wall Street Journal recently reported that Line`s cash generating capability is greater than U.S.`s WhatsApp or China`s WeChat. According to the media, revenue at WhatsApp, which was acquired by Facebook in February this year at 16 billion U.S. dollars, stood at an estimated 20 million dollars last year. Tencent`s WeChat, China`s largest mobile messaging service, hasn`t opened up its exact sales figures but is estimated to have posted between 32 million dollars and 48 million dollars in the fourth quarter of last year. After generating 505.8 million dollars in revenue last year, Line has posted the biggest profitability among the three messaging services.

According to a report by Macquarie Securities, Line`s revenue will increase up to 7.5 billion dollars by 2017 if the global app market shows a steady growth.

Thanks to Line`s huge performance, prospects are that Naver`s share prices will soar to 1.8 million won (1,731 dollars) from the current 800,000 won (769.6 dollars). Kim Mi-song, a researcher at Hyundai Securities, said, "Internet companies are forecasting a high growth potential of the mobile messenger service market," adding, "When Line goes public and Twitter is listed, Line`s share price could rise to 1.81 million won (1,741 dollars) if applying the price to sales ratio.