Puzzle & Dragons dev GungHo Online's market cap overtakes GREE, Zynga and DeNA

The market cap of Japanese developer GungHo Online Entertainment (3765:JP) has risen to $4.6 billion following the enormous success of its mobile game Puzzle & Dragons.

It's already being claimed that the release is currently the most lucrative mobile game in the world, generating well in excess of $50 million a month and making GungHo the top grossing developer on Google Play.

Since Puzzle & Dragons' launch in February 2012, GungHo's value on the Osaka Securities Exchange has soared, overtaking the likes of Zynga and GREE in recent weeks.

Now, as a result, the Tokyo-based developer is worth even more than DeNA, which has a market cap of roughly $4 billion.

Sustained success?

But whereas DeNA's valuation is based on its Mobage platform and a sizeable portfolio of games, GungHo's massive market cap seems to be based almost entirely on the success of a single title Puzzle & Dragons.

Educated estimates suggest that the title generates significantly more revenue each month than western success stories such as Clash of Clans or The Simpsons: Tapped Out.

Tokyo-based social gaming consultant Dr Serkan Toto, for instance, believes Puzzle & Dragons generates somewhere between $54-75 million each month a level of success he attributes to potent social hooks and canny use of television advertising.

But despite Toto's appreciation for Puzzle & Dragons' gameplay, he doesn't agree with the high valuations for its developer.

"I am very cautious when it comes to using big words, but this is insanity," said Toto in a post on his professional site. "GungHo's growth has one main and one only driver, namely Puzzle & Dragons."

[source: Serkan Toto]