On April 16, Superstar Legends announced that it had signed an agreement with the placement agent to place no less than 31.522 million shares to no less than six independent third party undertakers at a price of HK$7.1 per share. The total and net proceeds were HK$224 million and HK$223 million respectively.
According to the announcement, Superstar Legends plans to invest HK$79.8 million to invest and plan physical concerts for artists collaborating with the group, HK$60.5 million to increase the company's entry into the “metaverse/artificial intelligence digital content creation” ecosystem, and HK$60 million for potential investments related to the company's main business activities, such as mergers and acquisitions or investment in joint ventures to be established.
Yang Dehua, chief investment officer of Tianfu Asset Management, pointed out that the stock price rose for two consecutive days after the announcement of the placement news, reflecting the positive reaction of the market to this placement.
Yang Dehua believes that in the company's newly disclosed annual report, the IP business showed a strong growth momentum. The business share increased from 7% in 2019 to 44.26% at present, showing the trend of comprehensive companies with diversified IP driving new retail, which helps improve the Group's ability to fight the cyclical risk of the industry.
Furthermore, Yang Dehua further analyzed that thanks to the strong influence of the Star IP Matrix, Superstar Legend's overall revenue has increased significantly. At the same time, the “Star IP+ New Retail” business model is highly favored by the market. After less than a year of listing, the stock price has risen 1.2 times, and it has now delivered excellent results, so “it is worth continuing to be optimistic in the medium to long term.”
Concerts are popular, and “Classmate Zhou” drains and monetizes to generate revenue
The business of Superstar Legends mainly includes IP creation and operation and development and sales of new retail products. Among them, the IP creation and operation business includes being an event planning service provider, investor or subcontractor for large-scale concerts and other events. As the performance market and offline activities show a strong recovery in 2023, industry insiders believe it is expected to drive growth in the company's IP business segment.
In order to actively seize this growth space, Superstar Legends has increased its investment and expansion in the concert business. Recently, it was announced that its indirect wholly-owned subsidiary Star Chuangyi (Kunshan) has signed a cooperation agreement with Hunan Zhixin to jointly invest in Jay Chou's 2024 “Carnival” World Tour in Changsha. Others that have already participated include Fuzhou Station and the recently completed Hangzhou Station.
Superstar Legends invests in Jay Chou's concert, not only to be optimistic about the recovery of the performance market, but also to channel its products into a forward-looking layout. As the king of Chinese-language pop music, Jay Chou has had many loyal fans since his debut. The fan base spans ages, genders, and regions, and is a well-deserved “top class”, as can be seen from the fact that it is difficult to get a single ticket at a concert. For example, at Hangzhou Station, the concert was sung for 4 days, and the audience exceeded 200,000, making it the concert with the highest total number of total viewers and the most number of consecutive stadium shows in the history of Hangzhou; the outside of the venue attracted more than 300,000 spectators to listen.
As a concert investor, Superstar Legends breaks away from simply investing in concert production, actively explores the integration of diverse business formats, and realizes the business model of IP offline monetization through concerts. For example, during the “Carnival” Hangzhou station tour, Superstar Legends launched an innovative fusion of “IP+ Scenes”, placed 6 giant two-dimensional image IP “Zhou Classmate” FRP at major attractions in Hangzhou, planned the Citywalk route, and teamed up with Alipay to launch an AR check-in lottery campaign to attract a large number of fans to the pilgrimage. This also made the “Looking for Classmate Zhou” topic trending on Weibo.
(Picture: “Classmate Zhou” teamed up with Alipay to launch an AR check-in lottery, and the “Looking for Classmate Zhou” topic is trending)
Meanwhile, around the “Zhou Classmate” FRP attraction, Superstar Legend has set up a pop-up store to sell limited-edition city figures and surrounding derivatives. This time, we have also launched a vending machine sales area to further expand sales channels. By investing in the drainage of concert performances, the company turned traffic and popularity into economic benefits, became a “reserve” for the city's economy, and brought more business opportunities to itself.
(Picture: Fans line up in front of vending machines to buy “Classmate Zhou” peripheral products)
Metaverse/AI content creation application launched to add room for imagination
In this sale, Superstar Legends will also raise capital to increase its efforts to enter the “metaverse/artificial intelligence digital content” ecosystem and expand its layout in the metaverse/artificial intelligence content creation field. In May of last year, Superstar Legend and Vita Studio, the special effects producer of “Lord of the Rings” and “Avatar”, co-created Jay Chou's digital intellectual “Classmate Zhou” and authorized China Mobile to act as a spokesperson. In 2023, part of the revenue generated by “Classmate Zhou” Digital Intelligence Man and China Mobile reached 11.3 million yuan. In addition, it also launched the first metaverse pilot film “Dimensionality Development”, co-starring Jay Chou and “Classmate Zhou” digital intelligence as the first step into the metaverse/artificial intelligence digital content creation ecosystem.
And Superstar Legends's layout of the metaverse/artificial intelligence digital content ecosystem shows that it fully recognizes the future of this track. At present, artificial intelligence technology is at a stage where application scenarios are exploding, and applications in various fields are constantly expanding. In particular, in the fields of art such as music and movies, related applications have been successfully implemented and converted into actual benefits.
Take the Swedish pop music group ABBA as an example. They used motion capture technology to shape the band members into digital images of their heyday in the 1970s, and launched the digital concert “ABBA Voyage” to re-present classic music to the audience through digital images. Since the concert began in London in May 2022, it has attracted more than 1 million viewers in 12 months, with a total turnover of £322.6 million.
This success story fully demonstrates the huge potential of metaverse and artificial intelligence in the entertainment industry, not only bringing revenue to ABBA, but also opening up new business models and market space for the entertainment industry. Meanwhile, the “Metaverse/Artificial Intelligence Digital Concert” created by Superstar Legends has the opportunity to draw on ABBA's experience and use the power of metaverse/artificial intelligence content creation to create innovative performance formats to bring an immersive music experience to the audience.
In addition to IP licensing in the metaverse field, Superstar Legends is also trying to support the production of related content through investment in technology. According to information, Superstar Legends has developed a series of artificial intelligence systems, including AI voice generation systems, AI music generation systems, AI digital human live streaming systems, and WeChat conversation robots. Related technology can be used not only for IP content creation, but also for new retail businesses under Superstar to provide users with a more intelligent and personalized shopping experience, thereby improving service efficiency and user experience. Currently, Superstar Legends is constantly improving its technological reserve capacity, and it will be possible to monetize it to earn profits until it is further released and put into practical application.
Leverage the 10 billion dollar market by entering a video ringtone subscription account at a low cost
With its ability to create IP content, Superstar Legend has now expanded its licensing business into the field of wireless communications. In January of this year, Superstar Legend announced that it will join hands with the Chinese mobile music platform Migu Music to expand the video ringtone ecosystem. Its video lottery subscription account has officially entered the China Mobile Media Platform, launched a series of video ringtones featuring star IPs, and developed unique video ringtones for enterprise users, so that high-quality content can reap long-term benefits and further diversify revenue.
According to reports, Superstar Legend's profit methods include collecting user subscription fees directly from mobile phone charges through billing codes already obtained, content providers charging content production fees from operators, and revenue paid by advertisers to the operator for accurate ringbell delivery.
As a content provider, Superstar Legends can use the advantages of creating its own IP and media content to customize exclusive content. For example, through creative editing and secondary processing of program clips such as “Journey 1” and “Traveller 2,” and creating exclusive ringtones to attract more users interested in content and tap the motivation of users to subscribe for a long time; using existing content production can not only increase user stickiness, but also eliminate a large amount of production costs.
In addition, Superstar Legends can also help advertisers accurately target ringtones to specific groups of people and earn advertising revenue from them. According to industry insiders, this diversified revenue source can not only enhance the company's profitability, but also enhance its competitiveness in the video ringtone market and promote the company's long-term development.
According to China Mobile data, the number of mobile finance media users with video ringtones as the core currently exceeds 400 million, and the number of daily broadcasts on communication channels has reached 700 million times. The annual output value of video ringtones has exceeded 10 billion yuan, and there is huge room for development prospects.
epilogue
Taken together, Superstar Legends showed performance growth in its first annual report since its launch. Among them, the IP business revenue share increased to 44.26%, reflecting the growth potential of this business, which means that the company is gradually moving from a single new retail to a comprehensive company with diversified IP-driven new retail. This time, the company issued new shares for placement and was approved by investors. At the same time, the stock price did not weaken due to discounted placement, further establishing market recognition for its development. The author believes that with the support of this series of factors, Superstar Legends is expected to continue to achieve performance growth in the future, showing a good momentum of development.