Hua Er Jie Jian Wen·2025-07-16 15:01Core Viewpoint - Pop Mart's (9992.HK) performance in the first half of the year is expected to exceed expectations, with revenue growth projected at no less than 200% and profit growth at no less than 350% [1][2]. Financial Performance - The projected revenue for the first half of 2025 is expected to exceed 137 billion yuan, with net profit surpassing 45 billion yuan, both exceeding the total for the entire year of 2024 [1]. - Adjusted net profit margin for the first half of the year is forecasted to exceed 30%, a significant increase from 22% in the same period last year [2]. Market Reaction - Despite strong performance, Pop Mart's stock price has seen a decline of over 4% following the earnings forecast, indicating that the market may have already priced in expectations [3][4]. - The stock has increased by 1.8 times since the beginning of the year, reaching historical highs [3]. Product Strategy and Market Dynamics - The popularity of the LABUBU series is a key driver of Pop Mart's current market performance, but concerns about the sustainability of this popularity are emerging [5][6]. - The secondary market for LABUBU toys has seen prices double compared to the original price of 99 yuan, indicating high demand [7]. - Pop Mart has taken steps to manage supply and demand by halting sales of LABUBU products in several countries and launching large-scale pre-orders, which has led to a decrease in secondary market prices [8][9]. Production and Supply Chain - Pop Mart's production capacity has significantly increased, from an average of 300,000 units per month at the beginning of 2024 to 10 million units, indicating a rapid expansion [14]. - The company has faced challenges related to supply chain bottlenecks and the need to balance production across multiple IPs to avoid resource allocation issues [10][14]. IP Management and Future Outlook - Pop Mart is focusing on diversifying its product lines and managing the perceived scarcity of its IPs to maintain market interest [15][18]. - The company has been cautious with its IP licensing strategy, with revenue from IP licensing decreasing from 6.8% in 2023 to 4.5% in 2024 [17]. - Pop Mart is exploring new categories and collaborations to enhance its brand presence and IP value, including partnerships with luxury brands and the introduction of new product lines [15][18].