Hua Er Jie Jian Wen·2025-11-18 02:36Core 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].