A review of 2025 reveals three major trends in the film industry: 1) Animated film series delivered outstanding performances, with four animations ranking in the annual top ten box office charts, two of which set new records. 2) Derivative business layouts have become a key trend, as the strategy of "short-term box office revenue plus long-term derivative income" maximizes the commercial value of intellectual properties. 3) There was a sufficient supply of imported films, which have become crucial releases during the summer and year-end holiday seasons.
Looking ahead to the 2026 Spring Festival season, two highly anticipated sequels from successful IPs, "Pegasus 3" and "Boonie Bears 12," have already been scheduled for release. Other major industry players, including DAMAI ENT, MAOYAN ENT, Wanda Film, and China Film Co., Ltd., are expected to announce their own heavyweight titles for the period. Given the strong casting and the impressive historical box office performance of similar films, the outlook for the 2026 Spring Festival film season remains highly positive.
For the full year of 2026, the institution continues to express optimism regarding the performance of imported films. Sequels to major global IPs such as "The Avengers," "Spider-Man," "Toy Story," and "Minions" are all anticipated to be released in the domestic market. Following the smooth introduction of imported films in 2025 and the rich pipeline of Hollywood productions scheduled for 2026, the institution is bullish on the box office performance of imported movies in China this year.
The recommended investment targets are: 1) DAMAI ENT (01060): The company demonstrates strong performance in its IP business, and its live event segment is poised to benefit domestically from policy changes and internationally from the execution of hosted projects. Furthermore, it is expected to have significant involvement in both production and distribution during the 2026 Spring Festival season. 2) China Film Co., Ltd. (600977.SH): The company is well-positioned to benefit from a potential recovery in imported film box office revenue. Other companies to watch include ticketing leader MAOYAN ENT (01896), cinema chain leader Wanda Film (002739.SZ), and Shanghai Film Co., Ltd. (601595.SH), which stands to gain from the synergies of IP and AI.
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