Two characters in a still from The Four 2.
The main character in a still from recent hit The Hunger Games 2. Photos: CFP
Beijing Enlight Media Co, one of China's biggest private media and entertainment companies, saw its shares surge on Friday, which analysts attributed Sunday to positive market expectation for its Friday-released 3D Chinese hero film The Four 2.
The Shenzhen-listed company's shares grew by 3.50 percent on Friday to 36.05 yuan ($5.93), compared with an overall 1.55 percent increase in the culture sector.
Though The Four 2 received some negative reviews over its plot before being released, a good performance in the domestic box office is still anticipated mainly due to the large number of showings in cinemas and its fairly high ticket pricing as a result of the 3D feature, said Xiao Mingchao, a Beijing-based independent industry analyst.
This, to some extent, drove up Enlight Media's shares on Friday, Xiao told the Global Times Sunday.
The film has led China's daily box-office list for two consecutive days after earning nearly 26 million yuan on its first day on Friday, according to the latest data e-mailed on Sunday to the Global Times by Beijing-based entertainment industry consultancy Entgroup International Consulting.
Market investors' confidence in entertainment companies is likely to be affected by the box-office performance of their films, said Yang Shuting, a senior analyst with Entgroup.
The shares of Enlight Media jumped 63.6 percent during the last 14 trading days in December 2012 after its small-budget comedy film Lost in Thailand - released on December 12 - raked in nearly 1.2 billion yuan by January 12, 2013.
But Yang said that it is hard for films released in the rest of the year to copy the success of Lost in Thailand, which may cause the entire box office in 2013 to not perform as well as expected.
Data from the State Administration of Radio Film and Television (SARFT) indicated that the nationwide box-office income reached 17.07 billion yuan in 2012, 71.34 percent of which was during the first three quarters. Based on this percentage and the revenue of 16.42 billion yuan for the first nine months of 2013, the box-office income this year was expected to reach 23 billion yuan, according to the SARFT.
Some industry observers have doubts about this.
China's box-office income has exceeded 18 billion yuan during the first 11 months up to November, but it is likely that December will only bring the figure up to 20 billion yuan, said Yang.
This is despite the fact that China has entered the busy New Year film season - considered to be from December 1 to the end of next February - with up to 21 films coming out in December and 13 in January.
"Currently No Man's Land, invested by China Film Group Corp, and Huayi Brothers Media Group's Personal Tailor are expected to stand out. But audiences' passion may not be fueled by the former due to its gloomy plot while the whole sector cannot only rely on the latter [a comedy] either," Yang noted.
Although the box office may perform a little poorly, this does not mean that all domestic entertainment firms will lose money, as firms like Huayi have already offset their film production costs with product placement income, Yang noted.
Entgroup predicted that product placement in the domestic film market brought in revenue of 1 billion yuan, up from last year's 600 million yuan.
Therefore, investors should not assess the performance of an entertainment company based only on the performance of a film, said Yang.