South Korea's CJ CGV to Invest $200M in Vietnamese Theaters by 2020
The leading cinema operator plans to open 12 to 15 more locations per year in the booming market.
South Korean cinema brand CJ CGV plans to invest $200 million in its Vietnamese theaters over the next four years in order to expand its wide network of locations to remote areas.
CJ CGV opened its 50th Vietnamese branch in Ho Chi Minh City last Thursday, and plans to quickly boost the number by opening 12 to 15 new locations per year until 2020, including in second-tier cities. Launching a new cinema costs between $4 million and $7 million, and so the total sum the company plans to invest comes down to about a total $200 million.
CJ CGV is South Korea's leading operator and is an ancillary of CJ Group. Since entering the theater business in Vietnam six years ago, it has since become the country's No. 1 exhibitor. CJ CGV Vietnam dominates the Vietnamese box office with 43 percent of the share. With some 140 cinemas, the Vietnamese film market generated total annual revenue of $130 million in 2016.
Dong Won Kwak, head of CJ CGV Vietnam, said he expects figures to rise next year, given the market's growth rate of an estimated 20 percent annually
Kwak also noted the Southeast Asian country's growing audience size. Vietnam has a population of over 90 million, which is almost twice that of South Korea's rapidly aging 50 million. South Korean analysts have also noted the strong moviegoing demographic in the county: of the 90 million Vietnamese, some 60 percent are 35 and under.
Other foreign brands dominate the exhibition market in Vietnam. Lotte, another leading South Korean company, ranks second after CJ CGV with 30 percent of the market share, followed by Indonesia's Platinum Cineplex at 10 percent. Two Vietnamese companies, Galaxy and BHD Star Cineplex, account for 9 and 6 percent, respectively.
Meanwhile, CJ Entertainment, the investor-distributor subsidiary of CJ Group, has also enjoyed a string of successful co-production projects with Vietnamese partners.