Hengdian Entertainment (SH:603103) Sou Hu Cai Jing·2025-12-29 13:45Core Viewpoint - The article highlights the transformation of Hengdian, a small town in Zhejiang Province, into the world's largest film and television shooting base, driven by Hengdian Group's strategic investments in the film and tourism industry, resulting in an annual output value exceeding 35 billion yuan [1][3][21]. Group 1: Development of Hengdian - Hengdian Group was founded over 20 years ago, with a vision to create a film shooting location, starting with the construction of "19th Century South Guangdong Guangzhou Street" in just three months for the film "Opium War" [3][4]. - The group has since built over 30 large-scale shooting bases and more than 100 professional studios, making Hengdian the largest film shooting base globally [3][7]. - Hengdian's strategy includes waiving location fees for film crews, which has attracted numerous productions and boosted related industries, including catering, accommodation, and tourism [3][7]. Group 2: Economic Impact - In 2023 and 2024, Hengdian received 15.24 million and 13.93 million tourists, generating revenues of 2.638 billion yuan and 2.867 billion yuan, respectively [7]. - By 2020, Hengdian's film and cultural industry had achieved annual revenues of 15.7 billion yuan, with tourism revenues exceeding 20 billion yuan [7]. - The group has diversified into various sectors, including electronics and pharmaceuticals, with total assets reaching 103.978 billion yuan and revenues of 53.830 billion yuan as of the third quarter of 2025 [10]. Group 3: Unique Corporate Structure - Hengdian Group operates under a unique ownership structure, where wealth is considered collective rather than individual, with significant shares held by community organizations [14][16]. - The group has six publicly listed companies and is a major shareholder in Zhejiang Merchants Bank, holding 4.99% of its shares [9][10]. - The governance model emphasizes collective ownership, which has kept the founders out of personal wealth rankings, focusing instead on community wealth creation [11][12]. Group 4: Challenges and Adaptations - The group faces challenges, including a decline in market share for its magnetic materials from over 60% to around 30%, and the impact of short-form content on traditional film production [18][20]. - Hengdian is adapting by developing new filming environments for short-form content and enhancing visitor experiences through immersive activities and themed hotels [20]. - The group has invested in new projects, including a 12GW high-efficiency battery project and the expansion of Hengdian Airport, with ongoing investments totaling 11.678 billion yuan [19][20].