China’s Film Industry Faces Reckoning as Holiday Hits Fall Flat
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Shares of Chinese movie and cinema firms took a steep tumble following the National Day holiday, with an industry index down 12% over the seven trading days after the weeklong break. The sector finally showed signs of stabilization on Monday, when the index gained 2.2%.
Driving the rout was a lackluster box office performance during what is typically a blockbuster season for Chinese theaters. Holiday ticket sales totaled 1.8 billion yuan ($217 million), the weakest in nearly a decade. Attendance slid 5.3% year-on-year to 49.3 million, while the average ticket price fell 9.4% to 36.6 yuan. Analysts point to falling prices as the main culprit behind the revenue drop.
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- Chinese movie and cinema stocks fell 12% after a weak National Day holiday; box office revenue was 1.8 billion yuan, the lowest in nearly a decade, with attendance down 5.3% and ticket prices down 9.4%.
- Major films, including The Volunteers: Peace at Last and A Writer’s Odyssey 2, missed expectations, sharply impacting studio share prices.
- Low-budget film Deafening was a rare success, while broader industry challenges continue to unsettle investors.
- China Film Group Co. Ltd.
- China Film Group Co. Ltd. (中国电影股份有限公司) was a producer of "The Volunteers: Peace at Last," which topped the holiday box office. Despite this, the company's stock plunged 35% since mid-September and hit its 10% daily limit down on Oct. 9, partly due to expectations that the film would help recover a significant first-half loss. They were also among the producers for "A Writer’s Odyssey 2."
- Bona Film Group Ltd.
- Bona Film Group Ltd. is a Chinese film company. Its shares experienced a steep fall after the National Day holiday, despite co-producing "The Volunteers: Peace at Last," which led the holiday box office. However, its stock bounced back, hitting the 10% upper limit on October 20.
- Huace Film & TV Co. Ltd.
- **Huace Film & TV Co. Ltd.** was a producer of "A Writer’s Odyssey 2." The film underperformed at the box office and the company's shares sank 18% in the five trading days after the National Day holiday.
- Guomai Culture Media Co. Ltd.
- Guomai Culture Media Co. Ltd. was a backer of "The Starry Sky of the Three Kingdoms: Part I," an animated feature that significantly underperformed expectations at the box office. Following the negative holiday box office results, Guomai Culture Media's stock experienced a 10% limit down on the first trading day after the holiday period.
- Beijing Enlight Media Co. Ltd.
- Beijing Enlight Media Co. Ltd. was a backer of "The Starry Sky of the Three Kingdoms: Part I," an animated feature that underperformed at the box office. Following the holiday period, the company's stock dropped over 10%, despite a strong first half of the year largely attributed to the success of "Nezha 2."
- Lian Ray Pictures
- Lian Ray Pictures (联瑞影业) is a film production company. They were involved in producing "Deafening," a low-budget film that performed well at the box office, with market forecasts suggesting it could earn 240 million yuan, enough to break even.
- Maoyan Entertainment
- Maoyan Entertainment, a Hong Kong-listed company, started as a ticketing platform and has since expanded into film investment. They were involved in several holiday films, including the low-budget hit "Deafening." Despite their growing production business, Maoyan Entertainment's shares experienced a significant decline, losing 20% over nine consecutive sessions since September 22.
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