CJ CGV, the largest cinema operator by screens in South Korea, plans to invest $200 million to expand its presence in Vietnam over the next four years. CJ CGV plans to boost its cinema numbers by opening 12 to 15 new locations per year until 2020, and will expand its network of locations to remote areas across the country.
CJ CGV entered the Vietnam exhibition market in 2011 when it acquired local cinema chain Megastar Media Company with 54 screens in seven locations. To date, with the recent opening in Ho Chi Minh City, CJ CGV operates approximately 300 screens across 50 sites in Vietnam. It dominates the market with a 43% market share over the total box office.
Lotte Cinemas, another leading South Korean cinema exhibitor, also has a strong presence in Vietnam with 30% market share. Lotte entered the market with a similar approach, but earlier, in 2008, by acquiring Diamond Cinema Joint Venture Company (DMC). It currently operates 140 screens in 31 locations in Vietnam. Other key players in the market are Indonesia’s Platinum Cineplex with 10% market share, and two local companies, Galaxy and BHD Star Cineplex, accounting for 9% and 6%, respectively. Together, the top five exhibitors hold 98% of the total market share.
Vietnam is a potential growth market with a population of 95.4 million and has a rising middle class, and a young population. The Gross Domestic Product (GDP) in Vietnam was worth $207.9 billion in 2016, a steady growth from $77.4 billion 10 years ago. The film industry has experienced a remarkable growth as well, with a 23.8% rise in 2016 to reach $130 million box office, and a higher 26.5% rise in 2015. CJ CGV’s intensive investments in cinema infrastructure will no doubt accelerate the growth of the film market in Vietnam.