CJ CGV to Accelerate Global Expansion After 4DPLEX Secures KRW 220 Billion Investment from National Growth Fund—KB Securities

[Financial News] 4DPLEX, CJ CGV’s special-format theater subsidiary, is expected to secure KRW 220 billion in investment from the National Growth Fund. The investment is seen as providing a foundation for reducing its financial burden while accelerating the global expansion of its technology-driven special-format theaters. 
According to KB Securities on the 7th, third-quarter results are expected to exceed market expectations. KB Securities forecast revenue of KRW 683.6 billion and operating profit of KRW 56.4 billion. That would be 28.8% higher than the consensus estimate of KRW 43.8 billion. The number of domestic moviegoers in the third quarter is estimated at 40 million. The result reflects the consecutive box-office successes of The Odyssey and Spider-Man 4, along with policy support. In the 4DX segment, Spider-Man 4, which is being screened in both 4DX and ScreenX formats, is expected to generate a record operating profit of approximately KRW 9 billion. Overseas, the Chinese subsidiary is expected to turn profitable as demand recovers, while the Southeast Asian subsidiary is forecast to maintain stable profitability.
The key development is the structural change in the special-format theater business. Through this investment, 4DPLEX will be able to reduce its reliance on borrowing while pursuing technological upgrades and expanding its screen network. The scenario is to achieve economies of scale by increasing the number of screens installed in theaters worldwide.
Yonghyun Choi, an analyst at KB Securities, explained, "Global consumer demand for technology-driven special-format theaters is growing stronger," adding, "The share prices of IMAX and Sphere Entertainment demonstrate this trend." IMAX’s projected 2026 EV/EBITDA multiple is 14.5 times, more than double CJ CGV’s 7.6 times. The premium for special-format theaters is thus reflected in the valuation gap.
Restructuring efforts are also continuing. The number of CJ CGV’s domestic sites has declined from approximately 190 to 176 over the past five years, and the possibility of further gradual reductions remains open. Net debt is estimated to rise from KRW 1.742 trillion in 2025 to KRW 1.8801 trillion in 2026, but the debt-to-equity ratio is expected to fall from 533.9% to 431.9%. If profitability-focused management coincides with greater cost efficiency, operating leverage could become significantly stronger as market conditions improve.
However, there are clear reasons why the view was not upgraded. Projected 2026 return on equity (ROE) remains negative at minus 3.4%, keeping the company in the red. The interest coverage ratio is also only 0.7 times. The target-price range was set at KRW 8,000 at the upper end and KRW 4,000 at the lower end. The upper-end scenario assumes 150 million domestic moviegoers annually and an average ticket price (ATP) of at least KRW 10,000.

[email protected] Kang Gwi-gui Reporter