(Bloomberg) – Shares of South Korean companies that produce or distribute dramas and movies rallied as China resumed streaming a Korean movie after a six-year ban, raising hopes that more content will be allowed.
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Film distributor and producer Showbox Corp. climbed as much as 26% on Wednesday, causing a brief halt in trading due to the sharp swing in the stock price at the market open. KidariStudio Inc., a producer of online comics and other content, exceeded the daily limit by 30%. Other media stocks including Studio Dragon Co., CJ ENM Co., Astory Co. and ContentreeJoongAng Corp. also jumped.
The recovery, if broadened, would allow Korean cultural content producers to tap into the region’s largest consumer market, potentially boost their profits and further boost the appeal of Korean entertainment stocks. The country’s content producers and distributors have been in high demand after a number of blockbuster hits and the growing appeal of its pop culture.
Chinese regulators review content before it is allowed on online streaming platforms and it may take some time for recent series to be distributed on these sites.
However, “works that have already been produced may not take much time and that’s why we see Studio Dragon and ContentreeJoongAng’s shares trading higher” as the two companies have many old dramas and movie titles, said Kim Hoi Jae, an analyst at Daishin Securities Co.
Tencent’s online streaming platform began distributing “Hotel By the River” in November, local media including Korea Economic Daily reported earlier this month. The film, produced by independent director Hong Sang Soo in 2018, is the first Korean film to be released online in China after a six-year hiatus following the deployment of a US missile defense system in South Korea that created a diplomatic row between the two. Asian countries.
President Yoon Suk Yeol’s office confirmed on Tuesday that China had authorized the online streaming service amid the G-20 summit in Indonesia last week.
Yoon and President Xi Jinping agreed to boost cultural exchanges between the two countries at the summit where Xi acknowledged that “such a halt in exchanges does not benefit anyone and we look forward to working towards a full resumption,” said Yoon’s office.
“Although this is a small beginning, we would like to believe that it will become a future of great significance,” Kim Eun-hye, Yoon’s publicist, said during a press briefing on Tuesday. .
–With the help of Shinhye Kang.
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