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The Korea Herald
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THE INVESTOR
March 29, 2024

Retail & Consumer

CJ CGV’s outlook in Russia optimistic

  • PUBLISHED :October 24, 2017 - 16:26
  • UPDATED :October 24, 2017 - 16:26
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[THE INVESTOR] Korea Investment & Securities positively evaluated the entry of CJ CGV into the Russian movie theater market on Oct. 24 and maintained a buy rating at a target price of 8,000 won.

“CJ CGV announced after markets closed the previous day that it had entered into a contract with Russia’s ADG Group to establish a joint venture. The group is a local real estate developer that won a project to develop and operate shopping centers from the Russian government in 2014, which includes 39 complex theaters in Moscow,” KIS researcher Choi Min-ha explained. 




The cinema chain unit of CJ Group’s entry in Russia will be structured so that CGV will hold a 70 percent stake in the Hong Kong based joint venture SPC while the rest will be held by ADG. The JV will then establish RusCo to operate the movie theater business.

“CJ CGV’s total investment amounts to 24.5 billion won and in order to reduce financial burden, it plans to invest 100 million won in 2017, 10.4 billion won in 2018, and 14 billion won in 2019,” said Choi.

The firm has been expanding its overseas operations having entered China (2006), USA (2010), Vietnam (2011), Indonesia (2014), Myanmar (2014) and Turkey (2016). The cinema chain also stated that it plans to operate 33 theaters and 160 screens in Moscow by 2020

By Alex Lee (alexlee@heraldcorp.com)

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