While global cinemas are reeling from the coronavirus and delays to “Dune” and the latest James Bond release, shares of Japan’s biggest movie company are climbing back toward a record high as the world’s third-largest movie market slowly returns to normal.

Japan has weathered the pandemic better than most Western countries, with total infections at about 1% of the number of cases in the U.S. Gradual easing of social distancing measures have helped renew the upward trajectory for Toho Co., which operates movie theaters and produces film favorites including Godzilla.

Local audiences that once flocked to the likes of “Titanic” and Arnold Schwarzenegger hits started to favor domestic productions in the 2000s as quality and budgets rose. That’s helped isolate Japan’s movie market from the 2020 blockbuster drought that forced Cineworld Group Plc to suspend operations at American and British theaters.

Cineworld shares are down 87% this year while those of AMC Entertainment Holdings Inc. have dropped 44%. In contrast, Toho’s stock has recovered 45% from its March low, nearly erasing their 2020 loss and coming within 9% of their all-time record set last year. Shares rose as much as 0.6% in Tokyo on Thursday.

Toho operates almost 20% of the nation’s movie screens and is also a major studio, thanks to Japan’s lack of an antitrust law like the one in the U.S. that has barred such arrangements. The company certainly hasn’t been immune to the pandemic, with its theaters shut for weeks at the height of the state of emergency earlier this year and forcing postponement of a Doraemon release. Attendance had been limited to 50% but now full shows are allowed, provided that popcorn and drinks aren’t served.

A recent government campaign aimed at spurring entertainment and travel spending “gives people the impression that it’s safe to go see movies now, if theaters take precaution,” said Shoichi Arisawa, an analyst at Iwai Cosmo Securities Co.

While U.S. studios and cinemas play a chicken-and-egg game — with studios delaying releases because of low theater attendance, which is in turn due to a lack of hits — Toho has less to worry about. Domestic movies have made up more than half of the Japanese box office every year since 2008 and the country’s movie productions are back in business. Many of those movies are made by Toho itself, and are now facing even less competition with Hollywood hits.

Box office data for September will be announced in the coming days, a Toho spokesman said. Still, receipts in August were down 60% compared to a year earlier, which has some concerned.

“Looking at its longer term chart you wouldn’t know there is any crisis at all,” said Amir Anvarzadeh, a senior strategist at Asymmetric Advisors in Singapore. “It’s amazing to see how Toho has rallied since early August.” He recommends shorting the stock ahead of earnings, set to be reported on Oct. 13.

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