February 6, Beijing Hualubaina Film & TV Co. Ltd and HaiRun Movies & TV Co. Ltd. are leading a wave of initial public offerings by domestic TV companies, as cultural and media stocks gain in popularity among investors, the China Business News reported.
Beijing HualubaIna and HaiRun Movies, both TV production companies, are looking to list on Shenzhen’s Growth Enterprise Board and the Hong Kong Stock Exchange, respectively, in order to raise RMB 631 million and HK$1.56 billion, according to the report.
Other small TV production houses including Ciwen Film distribution Co. Ltd. and Beijing Galloping Horse Media Co. Ltd. are also planning to go public, according to the report.
China’s TV industry has emerged as a hot spot for investment, despite most market participants reporting weak financial performance. About 80% of TV dramas in China lose money or only break even, according to industry insiders.
The insiders said China makes the largest number of TV dramas of any market, about 20,000 last year alone, but 75% lose money and just 10% break even.
According to China-based research company Entgroup Inc., 17,000 episodes of dramas were produced in China in 2011, with 6,000-8,000 broadcast on TV, of which only 3,000 earned any revenue.