CSC SECURITIES (HK) LTD·2025-08-20 06:13Investment Rating - The report assigns a "Buy" rating to the company, with a target price of 325 CNY [1][6]. Core Insights - The company has shown significant revenue growth, achieving 13.88 billion CNY in revenue for H1 2025, a year-on-year increase of 204%, and a net profit of 4.57 billion CNY, up 396.5% year-on-year [7][10]. - The success of the Labubu IP has driven substantial revenue growth across various regions, with notable increases in the Americas (1142.3% growth) and Europe (729.2% growth) [10]. - The company has improved its gross margin to 70.34%, an increase of 6.20 percentage points year-on-year, due to a higher proportion of overseas revenue and effective cost control [10]. Summary by Sections Company Overview - The company operates in the toys and leisure products industry, with a market capitalization of 170.42 billion CNY and a share price of 280.80 CNY as of August 19, 2025 [2]. Recent Performance - The company reported a significant increase in revenue and net profit for H1 2025, with major contributions from various IPs, including THE MONSTERS and MOLLY [10]. - The product mix includes 37.3% from figurines, 44.2% from plush toys, and 7.3% from MEGA products [3]. Financial Projections - The company expects to achieve net profits of 9.7 billion CNY, 14.75 billion CNY, and 20.9 billion CNY for 2025, 2026, and 2027 respectively, with corresponding year-on-year growth rates of 210%, 52%, and 42% [12]. - The earnings per share (EPS) are projected to be 7.22 CNY, 10.98 CNY, and 15.56 CNY for the same years, with current price-to-earnings (P/E) ratios of 36, 24, and 17 [12].