It seems to be the best of times for China's film industry. With Tiny Times raking in 263 million yuan ($42.89 million) in the last four days of June (it was released on June 27), the domestic film market registered its highest half-yearly box office returns -10.9 billion yuan in the first six months of 2013, up 35 percent year-on- year.

More importantly, Chinese films accounted for 63 percent of the box office revenue compared with just 34 percent in the first half of last year. But the question is: Can this success be sustained and can Chinese films really compete against Hollywood blockbusters?

"The Chinese film market is rapidly expanding with over 3,000 new screens added each year. But despite this, there is still an element of luck behind the record box office revenue," says Peng Kan, research and development director at Beijing-based consulting company Legend Media.