Jakarta. MD Pictures, the Indonesian largest listed film company, is looking to push its overseas expansion following a $50 million minority buy-in by Tencent, a Chinese tech conglomerate, the company's top executive said.
“Tencent wanted to make an inroad to content creation business in Indonesia, like what they always do in other countries around the world," Manoj Punjabi, MD Pictures' founder and chief executive officer, told the Jakarta Globe on Friday.
“On the other hand, we are looking for a partner that can help us to expand globally. So, this is a perfect combination,” Manoj said.
Tencent Ltd, a Chinese tech conglomerate with international operations, has taken a minority stake in MD Pictures by purchasing 14.6 percent shares in the media company from Manoj for Rp 695 billion ($50 million). After the transaction, Manoj's ownership in the company dropped to 8.86 percent from 23.5 percent previously.
"With Tencent, we are surely looking into opportunities for expansion abroad. There are some projects in the pipeline," Manoj said, however refusing to elaborate further.
Manoj said there is no immediate plan for an additional capital injection from shareholders to MD Pictures at the moment to support the expansion plan.
MD Pictures said in a statement on Thursday that the minority purchase represented “Tencent’s positive outlook on the Indonesian content industry, as well as confidence in MD Pictures’ market leadership and potential growth.”
This news comes after MD Pictures’ stellar financial performance in 2021, in which the company’s net profit in the first six months this year reached Rp 35.97 billion ($2.5 million) compared to the Rp 33.62 billion loss in the first half of 2020. Sales also increased by 120 percent, reaching Rp 126 billion from Rp 56.79 billion a year earlier.
The company faced extraordinary growth throughout 2021 due to a surge of demand for digital media content on various streaming services, including major platforms such as Disney+Hotstar, Viu, Netflix, and others.
More and more consumers turned to the internet for entertainment, causing a significant increase in the number of viewers and resulting in the exponential growth of MD Pictures.
MD Pictures shares closed 0.5 percent higher at 432 apiece on Saturday, valued at 317 times of the company's earnings. The company's share has risen 236 percent this year, beating the Jakarta Composite Index's 8.83 percent gain.