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Shares in Imax China rose as much as 7.3 percent in Hong Kong trading Monday following news that the Chinese government will allow cinemas to reopen. Shares in other companies linked to the movie business similarly surged.
China’s State Council said Friday that entertainment and leisure facilities including cinemas, museums, tourist attractions and concert halls “may hold all types of necessary meetings and exhibition activities,” provided that they follow guidelines designed to prevent the spread of the novel coronavirus. The statement was the first centralized directive giving movie theaters, which have been closed in China since late January, the green light to resume business.
China’s leading movie ticketing company, Maoyan Entertainment, saw its Hong Kong-listed shares jump as much as 9.6 percent Monday, while Alibaba Pictures Group gained as much as 9 percent. That compares to a 2.2 percent climb by the city’s benchmark Hang Seng Index. In mainland China, Wanda Film Holdings, the country’s largest cinema chain, jumped 3.6 percent in early trading in Shenzhen, but was hovering around even for the day later in the afternoon.
The State Council’s new guidelines from Friday represents some urgently needed good news for the Chinese film sector. With the usual Lunar New Year box office bonanza a total washout this year, authorities estimate that total earnings from ticket sales will decline by at least $4.2 billion in 2020.
Several film executives contacted by THR on Monday said they were encouraged by the State Council’s statement, but that they are awaiting more detailed instructions from China’s Film Bureau — such as a target restart date and more fine-grained health guidelines — before moving ahead with reopening plans.
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