On February 27, 2026, Col Group Co.,Ltd., a company with over 25 years of experience in the digital entertainment sector, officially submitted its listing application to the Hong Kong Stock Exchange, embarking on its journey for an initial public offering.
Having been established in 2000, this industry veteran has witnessed the entire process of China's digital publishing industry from its infancy to prosperity. The company now possesses a vast content library and artificial intelligence technology reserves, betting on the emerging trend of overseas short-form dramas to seek new opportunities in the capital markets. However, years of consecutive financial losses cast uncertainty over this IPO endeavor. Whether AI empowerment and the short-form drama boom can become the key to its breakthrough remains to be tested by the market.
Tong Zhilei, born in 1975, graduated from Tsinghua University in 1998 with a bachelor's degree in Automotive Engineering. This was not the end of his academic pursuits. Two years later, in 2000, he earned an International Master of Business Administration degree through a joint program between the Massachusetts Institute of Technology and Tsinghua University.
Also in 2000, Tong Zhilei founded Col Group in Beijing and has since led the company from a digital publishing enterprise to a leading digital entertainment platform. At that time, the Chinese internet was still in its early stages, and digital content consumption was a novelty. Col Group emerged as an early explorer in the industry. In 2006, the original online literature website "17K.com" was launched, laying the groundwork for the future accumulation of its content library.
In January 2015, Col Group was listed on the Shenzhen Stock Exchange's ChiNext board, becoming the "first digital publishing stock" on the A-share market, with stock code 300364. Following its listing, the company continued its expansion. In 2016, it raised approximately 2 billion yuan through a private placement to strengthen its intellectual property digital content ecosystem. In 2017, Col Group initiated a global expansion strategy by launching an interactive visual reading application, extending its business reach into overseas markets.
In 2023, the company acquired animation studio Hanmu Chunhua to enhance its IP derivative development capabilities. That same year, it launched the first version of its AI content creation platform, "Xiaoyao," formally embracing the AI technology revolution. In 2025, as the short-form drama trend gained momentum, Col Group officially launched its overseas short-form drama application, FlareFlow, which received international recognition.
According to Col Group's Hong Kong listing document, the company has now established two core business segments, forming a dual-drive structure.
The first is the online literature and related business. As of the latest practicable date, the company has accumulated over 5.6 million digital content items, primarily covering online literary works. The latest disclosed data shows registered authors exceeding 4 million. Based on 2024 revenue, it ranked third among domestic online literature copyright-driven platforms. This business segment contributed revenue of 480 million yuan in the first nine months of 2025, accounting for 47.5% of total revenue.
Col Group stated that by leveraging its continuously improving technological innovation capabilities, particularly the application of AI technology, it has successfully transformed from a digital publishing enterprise into a content leader in the AI era. By empowering diverse content formats such as online literature, audiobooks, comics, AI-generated comic dramas, animations, and short-form dramas with AI technology, the company has expanded its business footprint from China to the global market.
The second core business for Col Group is short-form dramas and IP derivative products, which has been the company's strategic focus in recent years.
As one of the first Chinese companies to enter the short-form drama market, Col Group achieved revenue exceeding 100 million yuan from short-form dramas as early as 2022 and accelerated its overseas market布局 starting in 2023. Since 2022, the company has been developing the overseas short-form drama market. In the nine months ended September 30, 2025, revenue from the short-form drama and IP derivatives business grew rapidly, reaching 474.1 million yuan, accounting for 46.9% of total revenue. As of the latest practicable date, its overseas short-form drama app, FlareFlow, once ranked first on the daily free entertainment app charts in the US section of major mobile app stores. Through precise localized operations, it quickly gained traction, accumulating over 33 million registered users and offering approximately 5,200 short-form drama episodes.
Despite structural highlights in its core businesses, Col Group's financial performance is concerning. The root cause lies in the hidden worries brought by high spending. The trend of consecutive annual losses could potentially become the biggest stumbling block on its IPO path.
Financial reports disclosed by Col Group show that in 2022, the company's net profit loss was 362 million yuan, and its adjusted net profit loss was 393 million yuan. In 2023, although it achieved a net profit of 90 million yuan, the adjusted net profit still showed a loss of 38.34 million yuan. In 2024, the company's net loss was 243 million yuan, with an adjusted net profit loss of 271 million yuan. In 2025, the losses escalated further. The loss for the first nine months widened to 520 million yuan. On January 13 of this year, Col Group issued a performance forecast, anticipating a full-year 2025 loss between 580 million yuan and 700 million yuan, with an adjusted net profit loss projected between 579 million yuan and 699 million yuan.
Col Group explained that the company is in a critical phase of scaling its overseas operations. To maintain a competitive edge, it significantly increased promotional investments. Given that the related businesses are still in the investment phase, the associated costs cannot be fully covered by revenue in the short term, leading to substantial losses for the company in 2025.
Apart from performance factors, collective share reductions by senior executives have also become a focus of market attention. Shortly before Col Group submitted its Hong Kong IPO application, on February 3 of this year, the company released an announcement regarding the pre-disclosure of share减持 plans by its directors and senior management. Director Zhang Fan, Director and Executive Deputy General Manager Xie Guangcai, Chief Operating Officer Yang Ruizhi, and Deputy General Manager, Board Secretary, and Chief Financial Officer Wang Jingjing planned to reduce their shareholdings. The reductions, intended to take place within three months after 15 trading days from the announcement date, through centralized bidding or block trades, would represent up to 25% of their respective total shareholdings in the company.
Facing persistent performance pressure, Col Group hopes to raise funds through the Hong Kong IPO to consolidate its core competitiveness. According to the prospectus, the raised capital will be primarily used for five key areas: first, developing and improving AI technology to enhance content creation and distribution capabilities; second, building an overseas short-form drama ecosystem to further expand market share abroad; third, consolidating the content ecosystem and continuously expanding the digital content library; fourth, repaying some bank and other borrowings to optimize the financial structure; and fifth, supplementing working capital and for general corporate purposes.
Analysts point out that Col Group's IPO endeavor still faces multiple challenges. The primary risk is market competition. The domestic online literature market is highly concentrated, with leading platforms holding significant advantages. While the overseas short-form drama market is more fragmented, the number of participants continues to increase, making competition increasingly intense. Secondly, profitability remains uncertain. The sustainability of the company's growth model, which relies heavily on sales and marketing expenses, is questionable. If the growth of the short-form drama business slows in the future or if AI investments fail to meet expectations, losses could widen further. Additionally, the company faces potential risks such as rising content costs, intellectual property infringement, and changes in overseas regulatory policies.
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