《艾尔登法环：夜之统治》评价褒贬不一；IP实力或支撑销量

Japan | Interactive Entertainment Elden Ring Nightreign Faces Mixed Reception;IP Strength May Buoy Sales FLASH NOTE Elden Ring Nightreign(May 30 release) receives a Metacritic score 78 (forPS5). This is not a bad score, but it seemingly failed to meet expectations, asElden Ring(2022) marks 96, and a DLC (2024) has 94. We should not be sopessimistic about the review, as sales are likely to be supported by a hugefanbase for Elden Ring. But at the same time, it seems difficult to attractmany casual new users, so it's unlikely to become an unexpected big hit. Elden Ring Nightreignreceives mixed reviews:The media review embargo was lifted and nowthe review scores are available on review websites. In Metacritic, the most prominent gamereview score website, it currently marks 78. Positive sentiment centers on FromSoftware'score competencies - tight combat mechanics (highly responsive and skill-based fighting),high-quality boss design (memorable, challenging enemies), and strong class variety (a widerange of character types, each with unique roles and abilities). Critics commend the game'sreplayability through randomized elements (changing enemy layouts or item placements witheach playthrough) and find the three-player co-op dynamic well-executed when played underideal conditions (with friends using voice chat). Negative feedback, however, points to areliance on optimal multiplayer settings. The lack of in-game communication (no voice/textchat), cross-play, and duo matchmaking (no system for pairing two friends with a third player)makes it difficult for players without a full team to enjoy the experience. Solo play is essentiallyunviable due to the game's balancing around three-player groups. Low Metascore does not predictdisappointing sales:Compared withElden Ring(96) and DLC-Elden Ring: Shadow of the Erdtree(94),Nightreign's scorelooks ominous. However, there arecases where a title with a strong IP has sold well even if it has a low Metascore. 1) PokémonBrilliant Diamond / Shining Pearl (Nov 2021): It marked a score of 73, but it sold 14.7m inFY3/22, with an initial week's sales of 6m. 2) Resident Evil 6 (Oct 2012): With a score of 67, itsold more than 12m.If the previous game in the series is too highly rated, the reviews tendto be low, but the strong IP fanbase supports actual sales. As for Night Reign, the series is sohighly rated, and it is a spin-off with a very different gameplay, so the negative opinions standout due to the gap between high expectations and initial surprises. We believe there is no needto be overly pessimistic. Broader commercial appeal might be limited.However, due to gameplay specifications suchas not being able to easily play solo, it seems difficult to attract many new casual users whoare not fans of the Elden Ring/Dark Souls series. We don't think it will be a failure that greatlydisappoints expectations, but it is also unlikely that it will be a huge hit that greatly exceedsexpectations. Shunki Nakamura, CFA * | Equity Analyst+81(0)80 8120 7130 | snakamura@jefferies.com Atul Goyal, CFA ^ | Equity Analyst65 6551 3965 | agoyal@jefferies.com Company Description Bandai Namco Bandai Namco manufactures toys, stuffed animals, character goods, video games, commercial- and home-use game equipment, and software.The company's other businesses include operation of video game arcades and theme parks. KADOKAWA KADOKAWA engages in the IP content businesses in Japan. The first business was a book publishing company in Japan. Throughout its long-term history, KADOKAWA shifted its business portfolio toward technology-driven software content companies. KADOKAWA now leverages itscontent, which comes from publications to movies, TV animation, games, and other merchandise. To expand its educational content business,KADOKAWA has started an online high school business. Company Valuation/Risks Bandai Namco We forecast sales from main IP by analyzing the product cycle in each avenue (domestic toys, anime slates, and gaming). We project Toys &Hobby OP to be driven by anime slates of 1P/3P IP developed by internal and external studios. We expect Gaming OP to grow, driven by high-margin repeat title sales. Our price target of ¥6,060 is based on 25x FY3/27e EPS (¥242). Risks include (1) saturation and intensified competitionin Japan mobile games; (2) slowdown in the growth of Gunpla fan base; (3) inability of the pipeline titles to drive top-line growth or to foster therepeat title sales in the following year; (4) material cost hike pressurizes margins; (5) impact of global recession on overseas demand; and (6)slow OP recovery of Real Entertainment (Amusement). KADOKAWA Valuation:Our PT of ¥3,790 is based on SOTP analysis. Based on our FY3/27 estimate, our PT equates to a P/E of 29.6x. Risks:Volatility of title hits; tapering of internal cost reduction; regulations governing anime content; increased competition in content creation.Upside Risk: Major hit with NIGHT REIGN (i.e. 10m+ copies sales