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Internet celebrity economy favored by stock market
By:Wu Qiong   |  From:english.eastday.com  |  2020-01-08 16:32

Concept stocks derived from the “Internet celebrity economy” have recently become hot cakes on the capital market. Yinli Media, a company that has produced such reality shows as “Running Man” and “Where Are We Going, Dad”, has harvested eight daily limit boards in 10 trading days. Why is the capital city eyeing the Internet celebrity economy concept stocks?

The Internet celebrity economy cannot be deemed merely as concept hype, according to Kong Rong, a chief analyst from Everbright Securities. As she observed, the Internet celebrity economy has entered the 3.0 era, as new opportunities emerge because of short videos, live broadcasts, e-commerce, and advertising. What lies behind the phenomenon is the transformation in the video industry and the maturity of the business models of the Internet celebrity economy.

(More e-commerce companies choose to sell products via live stream broadcasting.)

As statistics on chinadatapay.com shows, Chinese male beauty blogger Li Jiaqi, who livestreams reviews of lipstick on live broadcasting platforms, earned nearly 200 million yuan (28.8million USD) in 2019, and online star Li Ziqi, who shares videos of her rural life online, earned 160 million yuan (23million USD) last year. If we take net profit indicators for listed companies in 2018, that means 2,123 Chinese companies earned less than Li Ziqi. To put it in another way, over 60% of A-share companies in China were out-earned by an Internet star, in terms of profitability.

(Li Ziqi)

(Li Jiaqi)

The new economy’s popularity in the capital market has also spread to the ears of many practitioners in the industrial chain. Peng Chao, who is in charge of an Internet celebrity service platform in Shenzhen, Guangdong province, has many people turning to him for advice. People want to figure out the logic behind the Internet celebrity economy and find investment opportunities in the industrial chain.

According to some industrial insiders, the boom of live-broadcasting e-commerce has indeed broken the ceiling of profit for many MCN (Multi-Channel Network) institutions since 2019. However, for the time being on the A-share market, there is still a lack of leading companies in the Internet celebrity economy. Investors should avoid the risk of short-term overheating. “Actually, the best MCN institution has not gone public yet,” said a business insider. He expects to see more qualified MCN institutions on the A-share market.

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