Deconstructing Stephen Chow's billion-level capital map, film and television investment is just the tip of the iceberg

Zhou Xingchi is known as the "king of comedy", with multiple identities as actor, director, producer and so on. However, from another perspective, we can find that Zhou Xingchi is also an investment master to be reckoned with, especially the recent sale of 51% stake in one of his film and television companies for 1.326 billion yuan, which has aroused great concern both inside and outside the industry. and this is only the tip of the iceberg of Stephen Chow's many investment layouts.

original title: deconstructing Zhou Xingchi's 1 billion capital map

Zhou Xingchi is known as the "king of comedy" and has multiple identities as actor, director, producer and so on. However, from another perspective, we can find that Zhou Xingchi is also an investment master to be reckoned with, especially the recent sale of 51% stake in one of his film and television companies for 1.326 billion yuan, which has aroused great concern both inside and outside the industry. and this is only the tip of the iceberg of Stephen Chow's many investment layouts.

strong > aim at film and television real estate / strong >

recently there has been a steady stream of hot topics about Zhou Xingchi, on the one hand, because the film "Journey to the West" produced by Stephen Chow has entered the publicity period and will be released in China at the end of this month. On the other hand, Stephen Chow sold a 51% stake in a film and television company named PREMIUM DATA ASSOCIATES LIMITED (hereinafter referred to as "PDAL") to New Culture Hong Kong, a wholly owned subsidiary of New Culture, and its related party, Young & Young, for a total price of 1.326 billion yuan, so that people can see a completely different performance of Stephen Chow in the capital market.

the reporter inquired about the relevant materials and found that Zhou Xingchi had a lot of layout in the film and television field alone. First of all, we have to mention the PDAL, which is not well known before, but whose valuation has reached 2.6 billion yuan. PDAL was registered in BVI in February 2002 and registered in Hong Kong in May 2003. it has three subsidiaries, including Qinggang Real Estate, mainly engaged in film and television entertainment content investment, development, production / distribution, TV drama production / distribution and other related services. Data show that PDAL's operating income from January to September 2016 was 81.1751 million yuan and its net profit was 64.185 million yuan, both far exceeding the performance in 2015.

although PDAL's current performance is good, Stephen Chow's most famous company in the film and television field is not PDAL, but Xinghui overseas. In 1996, Stephen Chow founded Xinghui overseas, and his first film, "God of Food", grossed more than HK $40 million. Subsequently, "King of Comedy", "Shaolin Football", "Yangtze River No. 7" and other works were released one after another. The film "Kung Fu" grossed nearly US $100 million worldwide, and "Mermaid" became the first domestic film to break 3 billion yuan at the box office. The market performance of many films makes Xinghui overseas have a certain scale of influence and market share in the market.

it is worth noting that Zhou Xingchi has also played a good hand not only in the film and television field, but also in the real estate field. Among them, Stephen Chow's mother, Ling Baoer, once revealed that Stephen Chow bought a piece of land with friends for 320 million Hong Kong dollars, and then the land was built into four villas, one of which cost as much as 380 million Hong Kong dollars. In addition, according to public information, Stephen Chow bought two shops in Mong Kok in Hong Kong for HK $30 million in 2002 and rented them at HK $230000 a month, and sold them for HK $43 million in 2004, making a higher profit. Stephen Chow bought a shopping mall in Tsim Sha Tsui, Kowloon for HK $210 million and sold it at a price of HK $300 million in 2009, making a net profit of HK $90 million.

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overall, Zhou Xingchi's investment layout in film, television, real estate and other fields has achieved greater returns and influence, but in fact, as a star investor, Chow Xingchi has not been able to get excess returns on every investment project from the very beginning, and has also experienced investment failure and company bankruptcy. And it is in the field of film and television, which is closely related to Zhou Xingchi.

according to news, before founding Xinghui overseas, Zhou Xingchi founded two film companies, but both went bankrupt because of poor box office sales. One of them is the Hong Kong Color Star Film Company founded by Stephen Chow and Yang Guohui in 1993, although most people do not remember the name of the company very much. however, "A Chinese Odyssey", which is regarded by many fans as a classic film, comes from the Hong Kong Color Star Film Company, and it is this widely recognized "A Chinese Odyssey" that ended in a fiasco at the box office at that time, and the company went bankrupt as a result.

in addition, in fact, Stephen Chow is still a shareholder of the Bigao Group, a listed company in Hong Kong, holding about 50% of the equity, but the performance of the Bigao Group is not very satisfactory. Bigao Group, formerly known as Ditong International, was originally engaged in electronic communications equipment, computer hardware equipment sales, etc., as early as 2009, Zhou Xingchi is one of the shareholders of the company, with a 24.21% stake. In May 2010, when Ditong International changed its name to Bigao Group and listed on the Hong Kong growth Enterprise Market, Zhou Xingchi also became the executive director of Bigao Group and increased his shareholding by buying shares several times later. At the same time, with the continuous deepening of Stephen Chow, the Bigao Group has also shifted its business to film production, artist development, post-production, concessions and derivatives, and has acquired mainland cross-border cinema investment companies, Jiayu Cinema Management Company, and so on. to the film and television terminal market.

however, according to the financial results for the first half of fiscal year 2017 released by Bigao Group in November last year, the turnover realized by Bigao Group during the reporting period was HK $25.005 million, a decrease of 37.37% over the same period last year. On the basis of-27.516 million Hong Kong dollars in the same period last year, the loss continued to expand to-36.213 million Hong Kong dollars. And losses have almost become the norm of Bigao Group. Through observation, it can be found that since fiscal year 2013, Bigao Group has made a profit in fiscal year 2013 and has been in a state of loss in subsequent fiscal years.

in the view of Wang Rong, a cinema marketing manager, Zhou Xingchi's investment in the film and television industry also represents the development characteristics of the film and television industry to a certain extent, that is, high risk. it is possible that the failure of a film at the box office can have a huge negative impact on the relevant film companies, or even make them bankrupt, and film companies need excellent content products if they want to gain a firm foothold in the film and television industry. And learn to control risks.

strong > Star influence is not always a magic weapon. / strong >

in view of the fact that 51% of Stephen Chow's company PDAL was acquired by New Culture, the relevant capital that Zhou Xingchi participated in received great attention in the market, and the share price of Bigao Group rose immediately after the news was announced. In the eyes of industry insiders, this can be seen as another star IP capitalization.

and New Culture said in the announcement of the investment PDAL that Stephen Chow's works have strong vitality and cashability, and he is also a scarce brand in the Chinese film market, and the company will further deepen the cooperative relationship with Stephen Chow and his team through this investment, and will carry out multi-dimensional reserve and development of Stephen Chow's high-quality IP in the future. In addition to giving up in writing, PDAL and its subsidiaries enjoy a priority of not less than 20 per cent of the total investment for films and television works for which Zhou Xingchi is the chief controller or creator (including, but not limited to, directors, screenwriters, producers and supervisors). In addition, the company will further improve the layout of the industrial chain through this investment, achieve synergy with existing business, enhance the investment and production capacity of films and TV series, and extend the industrial chain through the accumulation of high-quality IP resources to create an integrated industrial closed loop.

at this stage, star IP capitalization continues to appear. For example, in March last year, Tang de Film and Television planned to acquire a 51% stake in Wuxi Aimeishen Film and Television Culture Co., Ltd., owned by Fan Bingbing, at a price of more than 740 million yuan. Stormwind Technology plans to buy 60% stake in Straw Bear Pictures with Liu Shishi and Zhao Liying as shareholders, with a transaction amount of 1.08 billion yuan, which has attracted attention from inside and outside the industry. Industry insiders believe that star IP is scarce, and because of the topic and high fan effect based on the star's own influence, the market value or stock price of the company has increased to a certain extent after the relevant companies have taken up the star IP through capital.

however, due to the gradual acceleration of the iterative speed of the market, the shelf life of star capital is also difficult to predict. According to Xu Shan, an investment analyst, the phenomenon of capitalization based on star IP is increasing, and super-high premium acquisitions of star companies also appear one after another, which is not conducive to market development and further enhance the risk. Although some star companies of mergers and acquisitions have made performance promises, they have not fulfilled their performance commitments, and the case of dragging down the business development of the subject of M & An is not the only case, which is a wake-up call for the market. For film and television companies, although star IP is a kind of high-quality resource, it still needs to see how to use it and whether it can launch high-quality works, which is the key factor of whether it can gain a foothold in the market for a long time.

Edit: yvette