Refer Report
KT is worried about the growth portfolio of ‘Millie’s Library’, Korea’s largest reading platform subsidiary. The plan for a new business centered on web novels, which was initially planned to be introduced this year, was canceled, and no ‘Plan B’ of any kind was prepared.
According to industry sources on the 26th, voices are growing louder within KT that Millie’s Study, which was considered a ‘smart grandchild company’, needs a breakthrough. The background to the concerns is the stock price. The 27th marks one year since Millie’s Study made an initial public offering (IPO) on the KOSDAQ market. The stock price remains far below the public offering price (23,000 won) without any notable results for a year.
The closing price on this day was 15,370 won. It rose 1.79% from the previous day, but fell 33.2% compared to the public offering price. Compared to the highest intraday price (57,600 won) on the first day of the IPO, it fell 73.3%. Inside and outside of KT, there are concerns that the situation should not be ignored. The opinion of key executives was reported that discovering new businesses should be considered a top priority in order to secure a plan to stabilize the stock price.
It is known that even within Millie’s study, concerns are deep. Considering that sales and operating profits are solid, many complain that the stock price is undervalued. Millie’s Study recorded sales of 34.6 billion won and operating profit of 6.6 billion won in the first half of this year, up 33.1% and 32%, respectively, from the same period last year. Subscribers also steadily increased to 528,000 in 2022, 778,000 last year, and 867,000 in the first half of this year.
Nevertheless, the evaluation that there is no clear new business is holding back. The web novel project, which was scheduled to be launched this year, has been postponed. A company official explained, “We are internally considering various aspects, including new business priorities,” and added, “The timing of entering the web novel business has not yet been decided.”
Various services that combine artificial intelligence (AI) technology with e-books are also considered one of the new businesses that are being focused on. The company introduced the AI text-to-speech automatic conversion (TTS) function last July. The text in the content is converted into an AI voice as if a person were reading it. However, the industry’s assessment is that the ‘book reading service’ is not unique as it can be easily found on other reading platforms.
Millie’s Study is pursuing a plan to utilize AI to provide various services. In addition, it is known that they are looking into ways to expand their business using their own intellectual property rights (IP). An industry official said, “As the number of reading platforms increases, it will be difficult to attract market expectations with only services that can be found anywhere,” and added, “It is important to present a big picture that can lead to more innovative new businesses.”
Reporter Jeong Ji-eun jeong@hankyung.com
Source: korean