On Tuesday, at the close of the Asian market, YG Entertainment (122870.KQ) shares hovered just above its 2023 all-time low of KRW47,000. However, the YG stock jumped from a near-annual low by 29% on Wednesday, following news about its contract renewal with the pop girl group Blackpink. The Seoul-based K-pop agency entered into this exclusive agreement with all four members of the group.
YG Entertainment shares shoot up after Blackpink contract renewal
The promoter indicated the renewed contract includes the planning of a new album and Blackpink world tour. This news fanned the fires of other K-pop stocks, with HYBE Co., Ltd. (352820.KS) and JYP Entertainment Corporation (035900.KQ) shares leaping by 8.5% and 7%, respectively.
Blackpink splashed onto the music scene in 2016 and has since become one of the world’s most popular girl bands. They broke Billboard records with songs such as Shut Down and Pink Venom and became the first K-pop headline act at Coachella.
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YG Entertainment needed this boost as many questioned its ability to sign and retain top-earning artists. The company’s stocks crested in May but have since declined by close to 50% when whispers emerged that Lisa, one of the Blackpink members, may leave the group.
In this volatile industry, K-pop agencies need core performers on their promotions list to generate revenue. After making the contract renewal public, Bloomberg quoted Yang Hyun-Suk, the founder of YG Entertainment, who stated:
We are more than thrilled to finally make an official statement that YG will continue the intimate relationship with Blackpink. As the group represents YG and K-pop itself, they will certainly endeavour to shine brilliantly in the global music market.
