Rules and framework are needed for the long-term healthy development of China's e-sports industry, said the head of a Chinese video game and movie conglomerate.

"China's e-sports industry is still in its early stage, compared with the mature market in the US and Europe," Xiao Hong, CEO of Perfect World Co Ltd, told chinadaily.com.cn at the second Dota2 Asia Championships in Shanghai.

"For its orderly and healthy development, industry participants should join hands to set some rules and framework and comply with them," Xiao added.

China surpassed South Korea in 2015 to become the largest e-sports market in the world.

In 2016, China's e-sports gaming revenue was expected to surpass 50 billion yuan, up 50 percent year on year, according to a report released by research firm IDC at the end of last year.

The total prize money of global e-sports competitions in 2016 would reach 560 million yuan, with China accounting for 54 percent, the report said.

"China's e-sports industry is about to witness a market boom in 2017 and the market competition will become even more intense," said Zhou Zhaoning, an analyst at IDC China.

Founded in 2004, Perfect World is a China-based video game company specializing in massively multiplayer online role-playing games. The company's initial public offering on the Nasdaq was completed in 2007.

It delisted from the US stock market after finishing privatization last year.

"The emergence of top-level products has driven the explosive growth of China's e-sports gaming industry in the past two to three years," Xiao said.

More and more companies, investors, players and audiences are participating in the new industry, Xiao added.

In 2016, the Chinese government issued a guidance to promote the healthy development of fashion sports, such as e-sports in China. Some domestic universities have established e-sports majors after the Ministry of Education took "e-sports and sports management" into the major list in September.

With its borderless and entertainment characteristics, online games are good ways to spread Chinese culture, Xiao said. "The more we export, the better the world will know China."

Perfect World has been the largest game exporter in China for the past eight years, accounting for 40 percent of the total at its peak.

The second Dota2 Asia Championships concluded on April 4 in Shanghai, with iG team from China taking first place.