Core Viewpoint - The recent decline in the "new consumption" sector, represented by Pop Mart and its peers, has raised concerns about valuation, IP lifecycle, and market sustainability, following a rapid price drop in collectibles and stocks within a short period [1][2][3]. Group 1: Market Performance - Pop Mart's stock price fell significantly, closing at 239.6 HKD per share on June 20, down 3.62% for the day, with a trading volume nearing 10 billion HKD and a net sell-off of 617 million HKD by southbound funds, marking the highest net sell-off since May 12, 2025 [4]. - Over a week, Pop Mart's stock has declined over 15% from its peak of 283.4 HKD per share on June 12, resulting in a market capitalization loss exceeding 50 billion HKD from its high of 380 billion HKD [5]. - The collectible Labubu's price in the secondary market plummeted by over 50%, with some non-hidden variants dropping nearly 60% [6]. Group 2: Valuation Concerns - The "new consumption trio" has seen significant price corrections, with declines of approximately 19% for Lao Pu Gold, 17% for Mixue Group, and 15% for Pop Mart from their respective peaks [2]. - As of June 20, Lao Pu Gold had a year-to-date increase of 243.75% with a dynamic P/E ratio of 89.2, while Pop Mart's increase was 168.36% with a P/E of 95.3, and Mixue Group's increase was 153.83% with a P/E of 40.7 [8]. - Comparatively, traditional consumer giants like Kweichow Moutai have a P/E of 20.2, and international companies like Disney and Hasbro have P/Es of 23.7 and 22.3, respectively, indicating that the new consumption sector may be overvalued [8]. Group 3: Diverging Opinions Among Fund Managers - Optimistic fund managers believe new consumption has high growth potential and cash flow, while cautious managers warn of overvaluation and potential bubbles, suggesting that the current market correction serves as a valuable "stress test" [3][10]. - Some fund managers argue that the current high valuations are unsustainable, especially when comparing the market capitalizations of Pop Mart and Lao Pu Gold to established companies like Hasbro and Chow Tai Fook [9]. - Conversely, other fund managers maintain a positive outlook, citing the potential for continued growth in the new consumption sector, particularly in emotional consumption and overseas expansion [10][11]. Group 4: Investment Framework Evolution - The investment framework for new consumption is evolving, with traditional metrics like P/E ratios being challenged by the importance of emotional value, user engagement, and IP longevity [12]. - Analysts emphasize the need for a deeper understanding of target demographics and consumer behavior, moving away from a channel-focused approach to a more nuanced analysis of product appeal and consumer needs [13][14].