CJ ENM & Studio Dragon Market Cap Neck and Neck

On the 13th, Parent Company CJ ENM Surpasses Subsidiary Studio Dragon to Rank 10th in Market Cap
Studio Dragon's Strength Lies in Content... CJ ENM Also Focuses on Original Content

[Asia Economy Reporter Gong Byung-sun] The market capitalization of KOSDAQ content companies CJ ENM and Studio Dragon has been neck and neck, intensifying the competition between the parent company and its subsidiary.

According to the Korea Exchange on the 15th, on the 13th, CJ ENM recorded 142,500 KRW, up 0.71% (1,000 KRW) from the previous trading day, reclaiming the 10th position in KOSDAQ market capitalization. Meanwhile, Studio Dragon, which previously held the 10th spot, dropped to 11th place. This came just four trading days after Studio Dragon pushed CJ ENM out to take 9th place on the 7th.

The competition between the two companies began as Studio Dragon, a subsidiary of CJ ENM, experienced rapid growth. While CJ ENM's stock price rose 2.51% this year, Studio Dragon's increased by 12.42%. As a result, the market cap gap between the two companies has sharply narrowed. At the end of last year, CJ ENM's market cap was about 500 billion KRW larger than Studio Dragon's, but now the difference is only 12.4 billion KRW as of the closing price on the 14th.

The driving force behind Studio Dragon's growth is its content competitiveness. Last year, most of the top 10 popular works on the online video service (OTT) platform Netflix were produced by Studio Dragon. Among them, Sweet Home gained immense popularity, ranking among the top in Western markets as well. The success of Sweet Home also raised the per-episode overseas licensing fees. Although overseas licensing revenue excluding Netflix originals was about 40.8 billion KRW in both the first quarter of last year and this year, the number of works recognized as revenue decreased from 5.9 to 4.9.

Not to be outdone, CJ ENM has also invested in content. Earlier this year, CJ ENM announced it would invest approximately 400 billion KRW over three years in original content for its OTT platform TVING. This year alone, it is expected to produce about 10 original works, investing around 100 billion KRW. CJ ENM also signed a partnership with Naver. Last month, Naver launched the ‘TVING Unlimited Viewing Pass,’ allowing Naver Plus Membership subscribers to watch TVING content without limits.