2025-05-28 12:23Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 293.9, indicating a potential upside of 26.0% from the current price of HKD 233.2 [6][16]. Core Insights - The launch of the Labubu 3.0 series has created a global phenomenon, significantly increasing the brand's visibility and popularity, particularly in the collectible toy market [1][2]. - The domestic market is expected to see accelerated growth in Q2 2025, driven by the popularity of Labubu 3.0, with projected revenue growth of 95%-100% year-on-year [2]. - The company is shifting its focus to the North American and European markets, which are expected to become the main engines of overseas expansion in 2025, with significant revenue growth anticipated [3]. - The financial forecasts for 2025 and 2026 have been revised upwards, with revenue projections increased by 17% and 15%, respectively, and profit forecasts raised by 20% and 18% [4][13]. Summary by Sections Revenue and Profit Forecasts - For 2025, the company is projected to achieve revenue of RMB 25,732 million, representing a year-on-year growth of 97.4% [5][12]. - The net profit for 2025 is expected to reach RMB 7,030 million, with a year-on-year increase of 124.9% [5][12]. Market Performance - The report highlights that the U.S. market saw a revenue increase of 895%-900% in Q1 2025, while Europe experienced a growth of 600%-605%, surpassing Southeast Asia's growth of 345%-350% [3]. - The company's strategy includes relocating a majority of U.S. orders to Vietnam to mitigate potential supply chain risks associated with tariffs [3]. Financial Metrics - The report indicates a projected PE ratio of 26.7 for 2026, with a PEG ratio of approximately 0.4x, which is lower than most Chinese consumer stocks [4][12]. - The gross profit margin is expected to improve slightly year-on-year, contributing to the overall profitability of the company [4].