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Bernstein’s newfound passion for K-pop: An investment worth exploring!

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K-pop agency Hybe, known for managing popular boy band BTS, has been given an outperform rating by Bokyung Suh, director and senior research analyst at Bernstein. Suh believes in the long-term growth and macro trend of the K-pop industry, particularly as global players like Disney, Netflix, and Spotify continue to invest in K-contents. With approximately 500 million K-pop fans worldwide, the sector is expected to expand further. Suh highlights the intellectual property “diversification” of Hybe as a reason for choosing the agency, as successful IPs like Squid Game and Game of Thrones can lead to sustainable business growth.

BTS currently accounts for about 32.8% of Hybe’s revenue, followed by Seventeen at 30%, Tomorrow X Together at 15%, and NewJeans at 5-10%. Recently, Hybe renewed its contracts with BTS, alleviating concerns about the agency’s long-term growth. However, shares of YG Entertainment, another K-pop agency, faced a decline when reports surfaced that three out of four members of girl group Blackpink would not renew their contracts. As BTS members begin or will begin their mandatory military service in South Korea, their reunion and its impact on Hybe’s financials are expected around early 2026.

Overall, Suh’s positive outlook on Hybe stems from the lucrative future prospects of the K-pop industry, the agency’s strong talent management capabilities, and its diverse IP portfolio. With the continuous investment and support from global giants like Disney and Netflix, K-pop players are poised to benefit greatly from the growing popularity and global demand for K-contents.

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