The film industry explodes, institutions and individual stock capital operations appear one after another

"The Film Industry Promotion Law is a strong guarantee for the further development of China's films and can promote the more standardized and healthy development of China's film industry." Han Sanping, chairman of the China Film Producers Association and former chairman of China Film Group, said this.

The film industry once again has a good opportunity for development.

Premier Li Keqiang presided over an executive meeting of the State Council on September 1 and passed the "Film Industry Promotion Law of the People's Republic of China (Draft)" to improve the level of the cultural industry and promote the healthy development of the film industry.

Although the "Promotion Law (Draft)" has not yet been announced, it can be seen from previous drafts for comments that the main promotion direction is to lower market access thresholds, adopt fiscal, taxation, finance, land use and other supporting measures, strengthen supervision and management, and standardize the market. Order and other methods promote the healthy development of the film market. In addition, the draft for comments also emphasizes the need to strengthen film public welfare services to meet the basic cultural needs of residents in rural areas, low-income urban residents, migrant workers, minors, etc. to watch movies.

At the same time, various capital operations in the film industry also appeared "as scheduled".

Many listed companies are taking advantage of the wind to set sail.

A PE person who has invested in the film industry many times in Shenzhen told reporters: "We are currently preparing a new film fund to increase investment in the film industry. Today's society generally tends to be entertaining. Movies are already a must-have option in young people's entertainment activities. Good movie content will be sought after, and this will expand more investment space."

Coincidentally, *ST Xingmei (000892.SZ), which has been suspended since April 17, released a reorganization plan on the evening of September 1.

According to the plan, the company plans to acquire 100% equity of Huanrui Century by adding approximately 392 million shares to all 60 shareholders of Huanrui Century Film and Television Media Co., Ltd. such as Chen Yuan and Zhong Junyan at a price of 7.66 yuan/share. The estimated value of the underlying assets is 3 billion yuan; At the same time, the non-public issuance of approximately 175 million shares of shares from Huanrui United, Hongdao Tianhua, Qingyou Qianhe and Qingyou Ruihe at a price of 8.72 yuan/share, raising matching funds of no more than 1.53 billion yuan, which will be used for Huanrui Century TV series and movies. Investment, special effects post-production center and supplementary working capital. Huanrui Century will use *ST Xingmei to go public.

Coincidentally. On the evening of September 1, Wanda Cinema Line (002739.SZ) announced that it will strategically invest a 20% stake in Mtime. Both parties will fully launch the O2O business of film e-commerce, using the mobile Internet to seamlessly connect film derivatives, film promotion and offline theaters, creating a new model of film e-commerce to better serve film dealers, theaters and the movie-watching public.

Also making efforts is New Culture (300336.SZ). On the evening of September 1, New Culture announced that it had signed a five-year strategic cooperation agreement with Beijing Aiqiyi Technology Co., Ltd.(hereinafter referred to as "iQiyi"). The two sides will cooperate in the field of film and television dramas. During the cooperation period, the two parties have proposed a total market size target of RMB 1 billion for the project products such as TV dramas, online dramas, movies, games and their derivative products to cooperate every year.

It is proposed to cooperate on no less than 2 TV dramas and no less than 1 movie through various methods every year; no less than 2 cooperation projects through customized online dramas and customized online columns; in addition, no less than 1 film and television drama developed based on the company's existing mature and well-known IP cooperation is prioritized every year through various methods.

The above-mentioned PE person told reporters: "Wanda has indeed done a good job in recent years, from theater distribution to content production, peripheral derivatives, etc. However, we believe that the future trend of film production will be more towards one party taking the lead and multiple collaborations, which can not only share risks but also share benefits. At the same time, the market is huge enough to accommodate so many companies to develop together."

Wanda Cinema's 2015 semi-annual report showed that it achieved operating income of 3.486 billion yuan in the first half of the year, a year-on-year increase of 40.82%. Among them, online box office revenue exceeded 1.55 billion yuan, a year-on-year increase of 300%. This was mainly due to the continued prosperity of the film market in the first half of the year and the increase in the number of affiliated studios.

Judging from the majority of listed film companies that have announced results, they have achieved net profit growth. Huayi Brothers (300027.SZ) achieved revenue of 1.29 billion yuan in the first half of 2015, a year-on-year increase of 167.26%; net profit was approximately 500 million yuan, a year-on-year increase of 35.41%.

The net profit of Enlight Media (300251.SZ) in the first half of the year fell by 19.78% year-on-year because it had fewer film and television drama projects in the first half of the year. Galaxy Securities analyst Hao Yanhui also said: "Two-thirds of the company's films are released in the second half of the year."

The film market has huge potential

. Data from the State Administration of Radio, Film and Television show that from January to June 2015, the box office in the the mainland of China market totaled 20.24 billion yuan, a year-on-year increase of 48.9%. The number of screenings was 25.077 million, a year-on-year increase of 43.5%, and the number of movie viewers was 560 million, a year-on-year increase of 45.9%.

Among the 158 new films, 117 domestic films had a box office of 8.67 billion yuan, with an average box office of 74.1 million yuan per film; 33 imported films had a box office of 10.71 billion yuan, with an average box office of 320 million yuan per film; 8 special films (pure Hong Kong films and pure Taiwanese films) had a box office of 61.05 million yuan, with an average box office of 7.63 million yuan per film.

In addition, during the domestic film protection month in July, the State Film Funding Office preliminary statistics showed that the national film box office in July was 5.49 billion yuan. After continuously breaking daily box office records and weekly box office records, the monthly box office record in China film market was once again set. Among them,"Monster Hunt","Journey to the West: The Return of the Great Sage" and "Pancake Man" jointly contributed 3.365 billion yuan, accounting for more than 60%.

The above-mentioned PE person told reporters: "July belongs to the summer movie period, which is an important golden period in addition to the Lunar New Year, Spring Festival, and National Day. Due to its long duration, large market capacity and considerable box office revenue, the summer season has contributed a quarter of the domestic box office in the past five years. Setting the summer holiday as the Domestic Film Protection Month will also help promote the development and growth of domestic films and actively respond to greater opening up of the film market in the future."

In accordance with China's original commitment to join the WTO, China's import share for Hollywood in the United States will be further liberalized in 2017-2018. PricewaterhouseCoopers released its "Global Entertainment and Media Industry Outlook 2015-2019" predicting that China's box office revenue will exceed US$5 billion for the first time in 2015, and by 2019, China's box office will rise to US$8.86 billion.

Editor: yvonne