Core Viewpoint - The decline in popularity of Labubu is not indicative of a deterioration in the company's fundamentals, as Bubble Mart is not solely an IP toy company but a platform for creating and commercializing various IPs [1] Group 1: Market Performance - Recent sales data from the U.S. market showed a significant slowdown in growth compared to Q3 2025, leading to concerns about Labubu's brand strength [2] - The slowdown in sales is attributed to the pre-sale of Labubu in July and August, which exhausted future market demand and strained the supply chain [2] - However, sales data for the first week of November indicates a return to higher growth rates, with expectations for continued strong sales during the Thanksgiving and Christmas seasons [2] Group 2: Growth Potential in North America and Europe - Despite impressive growth in the Americas, this region accounted for only 16.3% of the company's total revenue in the first half of 2025, with projections of around 20% for the full year [3] - The company has only 41 retail stores in North America compared to 443 in Greater China, indicating significant room for expansion [3] - The European market also shows potential, with only 3.4% of total revenue coming from this region and just 18 retail stores as of the end of the first half of 2025 [3] Group 3: Valuation and Stock Performance - Bubble Mart is recognized as a leader in the global trendy toy industry, with solid fundamentals and a high certainty of long-term growth [4] - The current stock price has fallen to 15 times the estimated P/E for 2026, suggesting a high value proposition [4] - Short-selling activity has decreased, indicating improving market sentiment, and the company is expected to see a rebound in stock price and valuation as growth certainty for 2026 increases [4]

Company Overview - The company participated in the CICC annual strategy meeting, discussing overseas markets, IP sustainability, and supply chain rhythm, reaffirming confidence in its business model and long-term growth potential, highlighting bottom-fishing opportunities [1] Market Growth - The North American market has shown consistent performance since 2025, with the company establishing a comprehensive channel system. Q3 pre-sales have increased online sales, while offline channels remain crucial for IP expression and experience delivery. Supply chain and logistics adjustments present challenges, but seasonal performance is expected to improve with more quality stores and local experience accumulation [1] IP Commercialization - The decline in secondary market prices does not necessarily indicate a peak in IP popularity. The price fluctuations are influenced by the release schedule, with current supply levels exceeding secondary market transaction volumes. The increased availability of popular products enhances consumer experience and indicates broader customer reach for core IPs, supporting future growth [2] IP Lifecycle Management - The recent drop in search interest for popular IPs raises concerns about their lifecycle. However, the lifecycle is driven by product and content, and evaluating it solely on search trends is overly simplistic. Continuous product releases, innovation, and collaborations provide ample growth opportunities, with the company's operational capabilities expected to drive further scale. Secondary IPs are also showing rapid growth, confirming the company's platform advantages [2] Profit Forecast and Valuation - The company has adjusted its net profit forecasts for 2025 and 2026 upwards by 3.3% and 4.6% to 137 billion and 177 billion respectively. The current stock price corresponds to 20x and 15x adjusted P/E for 2025 and 2026. The company maintains an outperform rating and a target price of 370 HKD, implying a 71% upside potential based on 33x and 26x adjusted P/E for 2025 and 2026 [3]

Core Insights - LABUBU's popularity has significantly increased the attention on Pop Mart, marking it as one of the most discussed companies in the capital market this year [1] - The founder, Wang Ning, emphasized the importance of maintaining focus and staying true to the company's original vision as it celebrates its 15th anniversary [1] Company Strategy - Wang Ning compared the company's current situation to a novice driver in an F1 race, highlighting the challenges of managing increased attention and expectations [1] - The company aims to align with global trends and opportunities while acknowledging the gap between its current status and world-class enterprises [1] - The management strategy is characterized by a cautious approach, prioritizing selective opportunities and maintaining a "say NO more than say YES" philosophy [1] Market Expansion - Recent insights from the executive team indicate positive performance in overseas markets, with stores in the US and Europe showing strong sales and diverse customer bases [1] - The company plans to adapt to local market preferences by exploring local aesthetics and product trends, enhancing user experience, and focusing on talent development [2]

Core Viewpoint - Southbound capital transactions today amounted to approximately HKD 839.46 billion, marking a decrease of about HKD 144 billion from the previous day, the lowest level since May 29, accounting for 39.71% of the total turnover of the Hang Seng Index, which fell further today [2] Group 1: Southbound Capital Flow - Southbound capital recorded a net buy of approximately HKD 65.91 billion today, with net inflows from the Shanghai-Hong Kong Stock Connect at about HKD 24.89 billion and from the Shenzhen-Hong Kong Stock Connect at about HKD 41.01 billion [2] - Over the past month, the total southbound capital flow reached approximately HKD 1,322.25 billion, with HKD 648.54 billion from the Shanghai-Hong Kong Stock Connect and HKD 673.71 billion from the Shenzhen-Hong Kong Stock Connect [5] Group 2: Individual Stock Performance - Xiaomi Group-W (01810.HK) saw a significant net buy of HKD 23.94 billion, despite a drop of 4.81% today, with short-term funds increasing their holdings by 95.87 million shares over the past five days [3][4] - Alibaba-W (09988.HK) experienced a net buy of HKD 20.96 billion and a price increase of 1.16%, although short-term funds have reduced their holdings by 12.02 million shares in the last five days [3][4] - China National Offshore Oil Corporation (00883.HK) had a net buy of HKD 2.53 billion and a price increase of 1.19%, with short-term funds increasing their holdings by 4.23 million shares over the past five days [3][4] - Tencent Holdings (0700.HK) faced a net outflow of HKD 1.04 billion, with a slight price decrease of 0.16%, while short-term funds increased their holdings by 1.52 million shares [3][4] - Pop Mart International (09992.HK) saw a net outflow of HKD 0.60 billion and a price drop of 2.27%, with short-term funds increasing their holdings by 5.40 million shares [3][4]

Core Viewpoint - The report from Bernstein indicates a general slowdown in demand for Pop Mart in both China and overseas markets, warning that the company's Q4 performance may fall short of expectations, leading to a stock price drop of over 3% on November 12 [1] Group 1: Stock Performance - Since reaching a historical high of 339.8 HKD on August 25, Pop Mart's stock has been in a continuous decline, hitting a low of 203.6 HKD by November 7, representing a 40% drop and a market capitalization loss of 182.9 billion HKD [1] - The stock price decline is part of a broader trend among the "new consumption trio" in Hong Kong, which includes Pop Mart, Lao Pu Gold, and Mixue Group, all experiencing significant stock price corrections of around 40% [3][4] Group 2: Fund Holdings - In Q2, the number of public funds holding Pop Mart peaked at 311, with a total of 72.3 million shares. By Q3, this number dropped to 197 funds and 51.7 million shares, indicating a sell-off of 20.6 million shares, a 28.52% decrease in holdings [5][6] - Despite the overall reduction in holdings, the fund "Invesco Great Wall Quality Evergreen A" increased its position by 2.23 million shares in Q3, reflecting a belief in the company's future growth potential [8] Group 3: Comparison with Other Companies - Lao Pu Gold's stock also saw a significant decline, dropping from a high of 1108 HKD in July to a low of 592 HKD in November, a 46.57% decrease, with a market cap loss of 90.8 billion HKD [3] - Mixue Group's stock fell from a high of 618.5 HKD in June to a low of 371.6 HKD in October, a 39.91% drop, resulting in a market cap loss of 93.8 billion HKD [3] Group 4: Fund Manager Perspectives - Fund managers have differing views on Pop Mart's future. While some, like the manager of "Invesco Great Wall Quality Evergreen A," are increasing their positions, others, such as the manager of "Invesco Consumption Select 30 A," have significantly reduced their holdings due to concerns over market conditions and high baseline risks [8][14] - The overall trend indicates that while some funds are optimistic about future growth, many are opting to realize profits amid the stock's decline [8]

Core Insights - The article highlights the top short-selling stocks in the market, with AIA Group (81299), Li Ning (82331), and JD Group (89618) having the highest short-selling ratios at 100.00%, 100.00%, and 91.68% respectively [1][2] - Alibaba (09988), Xiaomi (01810), and Tencent (00700) lead in short-selling amounts, with figures of 3.531 billion, 1.787 billion, and 1.421 billion respectively [1][3] - China Mobile (80941), Shanghai Industrial Holdings (00807), and AIA Group (81299) have the highest deviation values, indicating significant differences from their historical short-selling averages [1][3] Short-Selling Ratios - AIA Group (81299) and Li Ning (82331) both have a short-selling ratio of 100.00%, while JD Group (89618) has a ratio of 91.68% [2] - Other notable companies with high short-selling ratios include Kuaishou (81024) at 90.75% and China Mobile (80941) at 90.20% [2] Short-Selling Amounts - Alibaba (09988) has the highest short-selling amount at 3.531 billion, followed by Xiaomi (01810) at 1.787 billion and Tencent (00700) at 1.421 billion [3] - Other companies with significant short-selling amounts include XPeng Motors (09868) at 1.012 billion and BYD (01211) at 1.001 billion [3] Deviation Values - China Mobile (80941) leads with a deviation value of 43.82%, indicating a significant increase in its short-selling ratio compared to its historical average [3] - Other companies with high deviation values include Shanghai Industrial Holdings (00807) at 40.85% and AIA Group (81299) at 36.63% [3]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 286.9, representing a potential upside of 32.0% from the current price of HKD 217.4 [1][5][15]. Core Insights - The report emphasizes that the company is not solely reliant on the popularity of its Labubu IP, but rather operates as a platform for creating and commercializing multiple IPs. The ability to launch new successful IPs is seen as a key competitive advantage [5]. - Recent sales trends in the U.S. market have shown a recovery, with expectations for continued growth during the holiday season. The report suggests that the recent slowdown in sales was largely due to pre-sales in previous months [5]. - The company has significant growth potential in the North American and European markets, which currently represent a small portion of total revenue. The report highlights the potential for expansion through physical retail stores in these regions [5]. - The current valuation is considered attractive, with a P/E ratio of 15 times the estimated earnings for 2026, indicating high value for investors [5]. Financial Performance and Projections - The company is projected to achieve substantial revenue growth, with estimated revenues of RMB 38,003 million in 2025, reflecting a year-on-year increase of 191.5% [7][10]. - Net profit is expected to reach RMB 12,920 million in 2025, representing a significant increase of 313.4% compared to the previous year [7][10]. - The report outlines a steady improvement in profit margins, with gross profit margins projected to rise to 70.8% by 2025 [10][11]. Market Performance - The company's stock has experienced volatility, but recent data suggests a recovery in market sentiment, with short-selling activity decreasing [5]. - The report notes that the company's sales in the domestic market have shown impressive growth, with online sales increasing by 212% in the first half of 2025 [11]. Regional Revenue Breakdown - In the first half of 2025, the company reported a 440% increase in overseas revenue, with North America showing a staggering growth rate of 1,142% [11]. - The report indicates that the company has only a limited number of retail stores in North America and Europe, suggesting significant room for growth in these markets [5].

Core Viewpoint - The new consumption concept stocks in Hong Kong continue to decline, with significant drops observed in several companies [1] Group 1: Stock Performance - Xiaopeng Motors (09868.HK) experienced a decline of over 10% [1] - Hou Shang A Yi (02589.HK) fell nearly 4% [1] - Other companies such as Leap Motor (09863.HK), Laopu Gold (06181.HK), Li Auto (02015.HK), and Pop Mart (09992.HK) all saw declines exceeding 3% [1]

Core Viewpoint - The market's concerns regarding Pop Mart's growth sustainability and single IP risk are considered excessive, with the company's core value lying in its unparalleled IP incubation and operational capabilities [1][4]. Group 1: IP Strength and Growth - The flagship IP Labubu has strong vitality, with its 4.0 version postponed to 2026 due to high demand for Labubu 3.0, and Sony Pictures is reported to have acquired the film adaptation rights, potentially enhancing the IP's global recognition [4][8]. - The company is diversifying its growth engines by actively managing online pre-sale scales to ensure sustainable IP operations, with a successful IP matrix formed around Labubu, SKULLPANDA, and CRYBABY, effectively mitigating risks [4][9]. Group 2: Global Expansion and Market Performance - Pop Mart's global expansion is exceeding expectations, particularly in the U.S. and Japan, with plans to optimize operations and deepen local market channels [6][10]. - The company aims to operate over 60 stores in the U.S. by the end of 2025, with additional plans for Canada, Latin America, and the Middle East, emphasizing localized operations and partnerships [10]. Group 3: Financial Performance and Valuation - Financial projections indicate significant growth, with net profit expected to rise from 1.082 billion RMB in 2023 to 23.169 billion RMB by 2027, and diluted EPS increasing from 0.807 RMB to 17.370 RMB over the same period [7]. - Citi has set a target price of 415.00 HKD for Pop Mart, representing a potential upside of 91.8% from the closing price of 216.40 HKD, based on a 28x P/E ratio for 2026 [1][13].

Core Insights - The top three companies by Hong Kong Stock Connect holding ratios are China Telecom (00728) at 72.14%, COSCO Shipping Energy (01138) at 69.18%, and GCL-Poly Energy (01330) at 69.09% [1][2] - Xiaomi Group-W (01810), Pop Mart (09992), and Industrial and Commercial Bank of China (01398) saw the largest increases in holding amounts over the last five trading days, with increases of +34.20 billion, +12.67 billion, and +11.24 billion respectively [1][2] - The largest decreases in holding amounts were observed in the Tracker Fund of Hong Kong (02800) at -58.33 billion, Alibaba Group-W (09988) at -40.89 billion, and Hang Seng China Enterprises Index (02828) at -18.98 billion [1][3] Group 1: Top Holding Ratios - China Telecom (00728) has a holding ratio of 72.14% with 10.013 billion shares [2] - COSCO Shipping Energy (01138) has a holding ratio of 69.18% with 0.897 billion shares [2] - GCL-Poly Energy (01330) has a holding ratio of 69.09% with 0.279 billion shares [2] Group 2: Recent Increases in Holdings - Xiaomi Group-W (01810) increased by +34.20 billion with a change of +81.51 million shares [2] - Pop Mart (09992) increased by +12.67 billion with a change of +5.83 million shares [2] - Industrial and Commercial Bank of China (01398) increased by +11.24 billion with a change of +172.61 million shares [2] Group 3: Recent Decreases in Holdings - Tracker Fund of Hong Kong (02800) decreased by -58.33 billion with a change of -219.93 million shares [3] - Alibaba Group-W (09988) decreased by -40.89 billion with a change of -26.39 million shares [3] - Hang Seng China Enterprises Index (02828) decreased by -18.98 billion with a change of -19.89 million shares [3]