Core Viewpoint - The appointment of Wu Yue, the president of LVMH Greater China, as a non-executive director of Pop Mart has not been positively received by investors, despite being seen as a significant move to inject luxury brand expertise into the toy industry. The company's stock price has significantly declined over the past months, reflecting investor skepticism about its future prospects [1][6]. Group 1: Appointment and Compensation - Pop Mart announced the appointment of Wu Yue as a non-executive director for a three-year term, with an annual compensation of 3 million HKD, which includes a fixed cash salary of 1.2 million HKD and a share-based salary of 1.8 million HKD [1][6]. - The market reaction to this appointment has been lukewarm, with only a slight increase in stock price following the announcement, and a significant drop of over 40% from its historical high in August, resulting in a market capitalization loss of more than 250 billion HKD [1][6]. Group 2: Background and Challenges - Wu Yue is recognized as a veteran in the luxury goods industry, having joined LVMH in 1993 and played a crucial role in expanding luxury brands in China [3][8]. - Pop Mart has faced multiple operational challenges, including a significant increase in the production of its core IP, Labubu, which has led to a decline in perceived scarcity and a drop in secondary market prices [3][9]. - Recent controversies regarding product quality and pricing have further impacted the brand's reputation, with notable incidents including employee comments on product pricing and issues with product consistency [4][9]. Group 3: Market Sentiment and Institutional Response - The high compensation for Wu Yue has sparked debate, as it exceeds the combined annual salary of three independent non-executive directors at Pop Mart and is higher than some executive directors' salaries [4][9]. - Institutional responses are mixed; Morgan Stanley views Wu Yue's appointment as a positive recognition of Pop Mart's IP in the fashion sector, while Deutsche Bank has downgraded its rating to "hold," emphasizing the need for the company to diversify beyond its single blockbuster IP strategy [4][9]. Group 4: Investor Dynamics - The recent board changes coincide with the exit of a key investor, He Yu, who sold shares at 32.32 HKD each, missing out on a subsequent 489% increase in stock price, which some interpret as a cautious stance on the company's long-term development [5][10].