How much does a free TV licence cost?

Have you ever seen a mature listed company that has not been suspended for a long time, soaring 200% per day? October 16, the real scene happened. The fact that the SAR government has issued a free television licence for the first time in 40 years may change the market pattern of the monopoly of television broadcasts (TVB).

On October 15, the Hong Kong Executive Council agreed in principle to grant a free television licence to cable broadband's wonderful television and Hong Kong Television entertainment under PCCW, while the original popular Hong Kong television network was unexpectedly "Lok Ma" and founder Ricky has invested HK $900 million.

Cable broadband surged over 200% in the opening 16th, closing at HK $1.20 and a sharp increase of nearly HK $1 billion a day. Mr Li's PCCW also showed a sharp rise, rising 4.6% per cent against the city. Hong Kong television, which had failed to speculate on the results of the 15th, was under pressure and fell nearly 40%.

Ricky held a press conference 16th, accusing the Hong Kong government of "black-box operations", deliberately concealing the results of the assessment of refusal to license the licence. On the same day, Hong Kong television announced 64% layoffs (320 people) and Ricky said it would seek all legal channels to recover compensation from the government. The Secretary for Commerce and Economic development, Sujinliang, refused to disclose details of the vetting process on the basis of guild secrecy, but stressed that the results had taken into account "a basket of factors" and that 2 new licences were conducive to market competition.

Some fund managers believe that Ricky's failure to TVB is good news, because its aggressive competition is the first half of TVB's profit backwards. Compared with Hong Kong TV, cable and PCCW investment scale is more cautious, will not immediately threaten TVB's boss status.

The TV dream of the "Magic Boy" in Hong Kong

"I still can't believe the decision made by the government." Regardless of the size of the investment, the creative team or the original ability of the programme, Hong Kong television is more qualified than the other 2 competitors to obtain licences, and the whole thing is a black box operation. ”

Ricky revealed that in 2009, the Hong Kong Government had voluntarily invited him to participate in the preparation of free television and hinted that there would be no limit on the issuance of licences. Last April, Ricky the creation of a Hong Kong broadband set of HK $5 billion to focus on the television industry.

Hong Kong television's medium-term earnings showed a total loss of HK $8.48 million in the first half, with programme production costing HK $200 million, $206 million for operating expenses and a capital expenditure of HK $520 million. Business income depends on artist manager income and news

Advertising support, its news station was off the air in September.

As of February 28, Hong Kong television, which had a cash share of HK $1.19 billion, shrank by 54.7% from 6 months ago, most of which came from one-off profits from the sale of Hong Kong's broadband. The total amount of outstanding loans soared from HK $3.27 million to HK $320 million.

Ricky has disclosed in public that the Tseung Kwan O Television Production Centre has "burned money" of HK $1 million a day, according to which, since March 1, the new expenditure at least HK $225 million has continued to deteriorate.

In mid-September, a Ricky bid for ATV, which had been issued for HK $600 million, was later denied by both sides. On that day, he reiterated: "There is no interest in bidding for any other television station, but it will not be withdrawn from the television ring." ”

Limited valuation of licences

How much does a free TV licence cost?

Huang, a rich financial management director, sums up an account for reporters, with a maximum increase of more than 200% per cent in cable broadband and nearly HK $1.6 billion by market capitalisation, with PCCW's value of more than HK $25 billion, which was at a median price of HK $151.6 billion. With the closing price, the increase in licence value has shrunk to HK $101.2 billion.

JPMorgan quoted the PCCW plan as saying that the new television station invested 600 million Hong Kong dollars in the first 3 years, launched a Cantonese free channel in 1 years and pushed English free channels within 18 months. In the view of the company, the free television licence can increase the source of revenue, but it is difficult to estimate the fair value changes brought about by the new licence because of the limited positive growth in the existing media business and the litigation risk from Hong Kong television.

Looking at cable broadband, the losses in the first half of the year were widened from HK $96.89 million to HK $112 million. Guo Jiayao, chief strategist at Silver Shing Wealth Management in China, said that the new TV station needs hundreds of millions of yuan upfront capital expenditure, even if advertising revenue increases, short-term also difficult to turn the profit, investors are not suitable for high pursuit.

"TVB is worth a rebound. Huang said TVB's share price had fallen by more than 20% since May, when the government was ready to start issuing licences, but eventually Ricky's exit removed the biggest worry in TVB's business.

From the beginning of last year, Ricky High-profile from TVB to dig horns, the city issued double pay, has successfully signed Riobire, Zhang Coli, such as wireless master Hua Dan; this August, tentacles even extended to Feng, Chen Fara, Miao Wei and other TVB pillars, the Shaw family is extremely dissatisfied. In terms of performance, TVB's first-half pre-tax profit fell 10% to HK $930 million, and the group said the biggest drag on profits came from artists ' salaries and wage adjustments.

TVB closed the closed 48.80 Hong Kong dollar, slightly rose 0.3%.