Investment Rating - The industry investment rating is "Recommendation" indicating an expected increase in the industry index by more than 5% over the next 3-6 months compared to the benchmark index [72]. Core Insights - The cultural and creative product market in China is steadily expanding, with the market size projected to grow from CNY 286.9 billion in 2019 to CNY 464.7 billion by 2029. Among materials, plastic resin is experiencing the fastest growth, while the metal cultural market is stable, with copper cultural products expected to reach a market size of CNY 1.6 billion in 2024, accounting for 6.3% of the metal cultural market [10][15]. - The industry exhibits a dual oligopoly structure, with the report's company, Copper Master, holding a significant online market share of 44.1% and a total market share of 35.0% in the copper cultural product market [22][23]. - Copper Master is expanding its direct sales network, with a focus on copper cultural products, which are the core of its offerings. The company plans to open approximately 70 new stores from 2026 to 2028, enhancing its offline presence [24][25]. Industry Overview Industry Scale - The cultural and creative product market is expected to grow significantly, with copper cultural products showing a compound annual growth rate (CAGR) of 7.3% from 2019 to 2024 [10][15]. - The demand for copper decorative items is strong, driven by gifting and decorative needs, with the market for copper figurines projected to be CNY 1.234 billion in 2024 [15][20]. Industry Structure - The copper cultural industry has around 1,000 participants, with a high concentration of market share among the top players. The top three companies hold a combined market share of 71.9% [22][23]. - Copper Master leads the market with a revenue of CNY 551.3 million in 2024, followed by Company A and Company B [23]. Company Performance - Copper Master reported a revenue of CNY 448 million in the first three quarters of 2025, reflecting an 11.2% year-on-year growth, with total sales exceeding 1.5 million units, a 35.1% increase [25][30]. - The company has maintained a gross margin of around 34.3% in 2025, although net profit margins have faced pressure due to increased expenses related to channel expansion and brand promotion [34][35].

Core Viewpoint - The company, Tong Shifu, is preparing for an IPO on the Hong Kong Stock Exchange, focusing on its unique copper-based cultural and creative products while expanding into other materials like plastic, silver, and gold [2]. Group 1: Company Overview - Established in 2013, Tong Shifu emphasizes original design and R&D, with copper as its core material [2]. - The company has expanded its product offerings to include 2,137 SKUs in 2022, 2,296 in 2023, and 2,485 in 2024, with new SKUs launched each year [3]. Group 2: Market Position - According to a report by Frost & Sullivan, Tong Shifu holds the top position in the Chinese copper cultural and creative product market, with a market share of 35.0% in revenue and 44.1% in online sales for 2024 [4]. - The brand has consistently ranked first in sales on major e-commerce platforms like Tmall and JD from 2022 to 2024, with an average online transaction value exceeding 750 yuan [5]. Group 3: Sales Channels - Online direct sales accounted for 70.6%, 69.9%, and 70.5% of total revenue from 2022 to 2024, with total online channel revenue percentages of 80.9%, 79.2%, and 77.2% respectively [5]. - The company has a weighted average repurchase rate of approximately 59.2%, 56.9%, and 56.4% across its online direct sales channels during the same period [5]. Group 4: R&D and IP Management - Tong Shifu has a strict IP management system, holding 1,575 copyrights, 285 design patents, 12 utility model patents, 9 software copyrights, and 2 invention patents as of December 31, 2024 [6]. - The company has invested approximately 18.8 million yuan, 28.6 million yuan, and 28.2 million yuan in R&D from 2022 to 2024, representing about 3.7%, 5.7%, and 4.9% of total revenue respectively [6]. Group 5: Financial Performance - The revenue for Tong Shifu was 503 million yuan in 2022, 506 million yuan in 2023, and 571 million yuan in 2024, with net profits of 57 million yuan, 44 million yuan, and 79 million yuan respectively [7]. - The net profit margins were 11.3%, 8.7%, and 13.8% for the same years [7]. Group 6: IPO Fund Utilization - The net proceeds from the IPO will primarily be used for product development, increasing production capacity, enhancing sales channels, upgrading digital infrastructure, and general corporate purposes [8].