Core Viewpoint - Guangdong Jintian Animation Co., Ltd. has submitted an IPO application to the Hong Kong Stock Exchange, aiming to leverage its unique "IP fun food" model, which combines snacks with collectible items, despite facing significant risks related to its heavy reliance on external IP licenses and declining core IP revenues [2][3][8]. Financial Performance - From 2022 to 2024, the company's revenue is projected to grow from 596 million to 877 million RMB, with net profit increasing from 36.7 million to 130 million RMB, and gross margin rising from 26.6% in 2022 to 34.7% in the first half of 2025 [5][6]. - By the first half of 2025, 99.5% of the company's revenue will come from its IP fun food products, indicating a critical dependency on external IPs [5][6]. IP Dependency - As of June 30, 2025, Jintian Animation holds 26 licensed IPs, with "Ultraman" being the most significant, contributing 62.6% of revenue in 2023 and 43.9% in the first half of 2025 [6][9]. - The top five IPs account for 85.7% of the company's revenue, highlighting a high concentration risk [6][9]. Business Model and Risks - Unlike companies like Pop Mart that operate their own IPs, Jintian Animation acts as an "IP carrier," relying on non-exclusive licenses, which exposes it to intense competition and uncertainty regarding IP renewal [8][9]. - The licensing agreement for the core IP, "Ultraman," is set to expire in 12 months, posing a risk to revenue stability if not renewed [8][9]. Cost Structure and Profitability - The company's IP licensing fees have increased from 21.1 million RMB in 2022 to 36.8 million RMB in 2024, with a significant rise in the proportion of licensing fees to sales costs from 4.8% to 6.9% by the first half of 2025 [10]. - Direct sales revenue has surged from 3.5% to 43.2% of total revenue, but this has led to increased customer concentration, with the top five clients accounting for 40.7% of revenue in the first half of 2025 [11]. R&D and Innovation Challenges - The company's R&D expenditure has increased from 67,000 RMB in 2022 to 212,400 RMB in the first half of 2025, but there is a lack of substantial progress in developing proprietary IPs [13][15]. - The focus on licensing rather than innovation has resulted in a lack of product differentiation, limiting growth potential in a competitive market [15]. Future Outlook - The IPO aims to raise funds for expanding the IP portfolio, developing new products, and establishing offline IP-themed stores, which are critical for building a sustainable competitive advantage beyond "Ultraman" [15].