Summary of the Conference Call for Damai Entertainment Industry and Company Overview - **Company**: Damai Entertainment - **Core Businesses**: - Damai Live Ticketing Platform - Aliyu IP Licensing and Film-related Business - **Market Position**: Leading provider of live entertainment ticketing services in China, actively expanding into overseas markets [2][4] Key Points and Arguments Damai Live Ticketing Platform - **Revenue Growth**: Expected revenue of 21 billion in 2024 with a gross margin of 64% [2] - **User Growth**: Monthly Active Users (MAU) increased from a few million pre-pandemic to 20 million in 2024, peaking at 50 million [2][7] - **Market Expansion**: Significant growth in the large concert market, from 3-4 billion annually (2016-2019) to approximately 30 billion in 2024 [2][9] - **Service Fee**: The platform's service fee rate is around 7-8% [6] Aliyu IP Licensing and Derivative Products - **Revenue Increase**: Revenue grew from 200 million in 2019 to 1.4 billion in 2024, with a total agency amount of approximately 4 billion USD [2][10] - **Partnerships**: Collaborations with well-known IPs like Sanrio and Pokémon, which have significantly contributed to revenue [11][12] - **SKU Development**: Over 30,000 SKUs launched through partnerships with more than 200 brands [13] Market Trends and Future Outlook - **Concert Market Growth**: The concert market is projected to reach 300 billion in 2024, indicating a rapid recovery and growth post-pandemic [9] - **IP Licensing Market**: China's licensed market is expected to become the fourth largest globally by 2025, with continued rapid growth anticipated [14] Content Production and Film Ticketing - **Ticketing Market Share**: Taopiaopiao holds a stable market share of 30-40% in the film ticketing sector [15] - **Content Strategy**: Ali Pictures has adopted a "dual dragon" strategy, focusing on both ticketing and high-quality content production, with a projected revenue of 500 million from series in 2024 [15][16] Additional Important Insights - **Seasonal Demand**: MAU shows seasonal fluctuations, particularly during peak concert seasons [7] - **Diverse Event Hosting**: Damai actively hosts various events, including music festivals and theater productions, to enhance its influence in the entertainment sector [8] - **Profitability Challenges**: Despite revenue growth, the content production segment faces low gross margins due to customized production costs [16]

Core Insights - The article highlights the dissatisfaction of parents regarding the quality and pricing of the "Ultraman" children's theater performances, which are significantly more expensive than movie tickets, leading to complaints about misleading advertising and poor execution [1][2][3] Group 1: Performance Quality and Consumer Experience - Parents reported that the performances, priced at six times that of movie tickets, failed to deliver promised experiences, such as VIP packages and quality production values, resulting in disappointment for both children and parents [2][3] - The performances were criticized for lacking professional production elements, with costumes that did not adequately conceal performers and overall poor audio-visual quality [2][3] - Legal experts indicated that consumers could claim refunds based on misleading advertising and unmet contractual obligations, emphasizing the need for higher quality standards in children's cultural products [3] Group 2: Licensing and Authorization Issues - The article discusses the confusion surrounding the licensing of "Ultraman" performances, noting that multiple companies hold different rights to the IP, leading to inconsistencies in quality and pricing [6][7] - The authorization fees for performances can be as low as 3,000 yuan per show, raising concerns about the quality of productions that can be offered at such low costs [5][6] - The original rights holder, New Chuanghua, has not authorized cinema performances, indicating potential unauthorized use of the IP by other companies [5][6] Group 3: Market Dynamics and Financial Implications - The article outlines the significant financial potential of the "Ultraman" IP, with estimates suggesting that the licensing and derivative product market could be worth tens of billions, highlighting the long-term financial impact of historical licensing decisions [7][9] - Companies leveraging the "Ultraman" IP have seen substantial revenue growth, with examples of firms achieving over 100 billion yuan in revenue due to successful product lines based on the IP [9][10] - The fragmented licensing landscape has led to market confusion and varying product quality, which could harm the brand's reputation and consumer trust [8][10]

Summary of the IP Industry Research Conference Call Industry Overview - The IP licensing industry is experiencing rapid growth in GMV (Gross Merchandise Value) and licensing revenue, indicating significant market opportunities [1][2] - Companies should differentiate between IP as an asset and the commercialization of IP, taking cues from the Pop Mart model by signing multiple IPs to diversify risk and leverage the advantages of virtual characters [1] Key Insights - The evaluation of IP value should focus on content, image, and topicality. IP can be categorized into text, comics, animation, and character image types, similar to how artists are classified into "visual" and "performance" categories [1][5] - Alibaba's IP platform, Aliyu, saw its GMV grow from $430 million in 2022 to $4.1 billion in 2024, a ninefold increase, significantly improving its global ranking among licensing agents [1][6] - Companies like Pop Mart, Miniso, and Aofei Entertainment are benefiting from the IP derivative licensing market [1] Core Competencies for IP Management - Companies need two core capabilities in IP management: discovering emerging IPs and transforming them into hits [7] - The average age of the top 50 global IPs varies by category: book IPs average 62 years, animation IPs average 37 years, and comic IPs average 47 years. Character image IPs tend to have shorter lifecycles due to a lack of supporting story content [8] Revenue Structure and Monetization - Among the top 50 global IPs, game IPs generated over $240 billion in total revenue, with over $150 billion from in-game revenue, while only $3.3 billion came from film adaptations [9] - Character image IPs, despite being fewer in number, have the highest commercialization revenue, with over $60.5 billion from merchandise sales [9] - Books have low initial revenue but can significantly increase through adaptations, as seen with over 100 animated series launched in 2023 based on web literature [10] Factors for Success in IP - Successful character image IPs must meet three criteria: alignment with public aesthetics, differentiation to avoid market saturation, and extensibility for multiple designs [11] - Game IPs face challenges in external monetization due to their interactive nature, making it difficult to adapt them into other media forms [12][13] Competitive Analysis of IP Companies - Analyzing an IP company's core competitiveness involves assessing resources, strategy, and channels. Companies must have the ability to acquire quality IPs and effectively market them [16] - Pop Mart's success in promoting IPs from inception to market includes hosting exhibitions and establishing direct sales channels, enhancing its influence [17][19] Importance of Offline Channels - Offline channels, such as direct stores and theme parks, provide immersive experiences that serve marketing functions beyond mere revenue generation [18] Conclusion - The IP industry presents substantial growth opportunities, with companies needing to adapt their strategies to leverage emerging trends and consumer preferences effectively.

Core Viewpoint - The company, 小黄鸭德盈, reported a significant revenue increase of 37% in the first half of 2025, amounting to 82.31 million HKD, while narrowing its losses by 38% to 11.65 million HKD. The company also announced plans to acquire the toy company HIDDEN WOOO, which will enhance its control over the IP matrix and toy product line [1]. Financial Performance - In the first half of 2025, the company achieved a revenue of 82.31 million HKD, reflecting a 37% year-on-year growth [1]. - The company reported a loss of 11.65 million HKD, which is a 38% reduction compared to the previous year [1]. - The IP licensing business generated 38.44 million HKD in revenue, marking a 46% increase year-on-year [4]. - E-commerce and other business segments contributed 43.87 million HKD, with a year-on-year growth of 31% [5]. - The overseas revenue saw a remarkable increase of 160% year-on-year [9]. IP Development and Strategy - The company has established a diverse IP matrix, including partnerships with various cultural entities and brands, enhancing the cultural relevance of its core IP, B.Duck [2][3]. - The company has expanded its IP licensing partners from over 280 at the time of its IPO in 2022 to 577 partners, with over 50,000 SKUs [4]. - The acquisition of HIDDEN WOOO will allow the company to hold a 51% stake, further enriching its IP portfolio and expanding its toy product line [6][7]. Product and Market Expansion - The company is focusing on the toy retail sector, particularly in the潮玩 (trendy toy) segment, and has adjusted its product offerings to cater to younger consumers [5]. - The company is actively developing its presence in the cultural tourism sector, with plans to create a sustainable IP tourism ecosystem [8]. - The company has made significant strides in international markets, particularly in Thailand, where its products have entered major retail channels [9]. Future Outlook - The company aims to enhance its brand strategy from "Be Playful" to "Make A Playful World," indicating a commitment to global expansion while maintaining its roots in China [9].

Group 1: Core Insights - Sanrio has established a significant presence in the global cultural consumption sector since its founding in 1960, with a warm philosophy that emphasizes friendship through small gifts, creating an IP empire across 130 countries and regions [1] - The iconic character Hello Kitty, created in 1974, along with other distinct IPs like My Melody and Kuromi, forms a matrix of emotional symbols that resonate with consumers across generations [1] Group 2: Performance in China - In the Chinese market, Sanrio has achieved a sales revenue of 816 million yuan for the fiscal year 2025 (April 2024 - March 2025), representing a 44% year-on-year growth [3] - The core growth driver is the IP licensing business, with significant increases in local product sales and original brand manufacturing (OBM) aimed at global markets, particularly Japan [3] - Sanrio has opened 44 stores in China, including 5 direct-operated stores, and has enhanced emotional connections with consumers through diverse experiential scenarios such as art exhibitions and pop-up stores [3] Group 3: Digital Transformation - Sanrio China is strategically focusing on digital operations to address common retail challenges such as channel fragmentation and complex multi-platform integration [4] - The brand aims to build a comprehensive digital ecosystem to support its "IP platformization" strategy and rapid growth, enhancing consumer experience through integrated supply chain management and marketing [4] Group 4: Partnership with Haiding - In April 2025, Sanrio China partnered with Haiding to initiate a comprehensive digital upgrade project, leveraging Haiding's expertise in global support, intelligent supply chains, and smart marketing [6] - The collaboration aims to resolve issues related to fragmented systems, improving data interoperability across purchasing, inventory, and membership systems [6] - Post-implementation, Sanrio China has seen significant improvements in store checkout efficiency, inventory management accuracy, supply chain responsiveness, and enhanced capabilities for data-driven marketing [6] Group 5: Benchmark Significance - The partnership signifies a milestone in Haiding's efforts to assist top global IP retail brands in their digital transformation, creating an innovative model that combines cultural IP with digital technology [8] - With the project fully operational, Sanrio China is on track to achieve its strategic goal of exceeding 500 million yuan in profit within three years [8] - Haiding's solutions have already supported over 1,000 enterprises in achieving efficient digital transformation across various retail sectors globally [8]

Core Viewpoint - The collaboration between Alibaba's Aiyu and Sanrio is driving significant revenue growth for both companies, particularly in the Chinese market, with strong performance in licensing and IP authorization. Group 1: Company Performance - Damai Entertainment (01060) saw its stock price increase by 7.08%, reaching HKD 1.21, with a trading volume of HKD 2.32 billion [1] - Sanrio reported a revenue of RMB 376 million in Q1 of FY2026 for its China operations, marking a 120% year-on-year increase [1] - The licensing revenue for Sanrio in China was RMB 251 million, reflecting a 158% year-on-year growth [1] Group 2: Strategic Partnerships - CITIC Securities noted that the partnership between Aiyu and Sanrio has positively impacted both companies' performance [1] - The collaboration is expected to contribute over 50% of Aiyu's revenue in FY2025 [1] - Sanrio's strong performance in China and its emphasis on the significant contribution from this market indicate a solid and beneficial partnership with Aiyu, focusing on long-term operations and steady growth [1] Group 3: Marketing and Future Prospects - Aiyu's marketing initiatives for Sanrio are expected to enhance the development and operation of other collaborative IPs such as Chiikawa, Crayon Shin-chan, and Universal Studios in China [1] - The successful execution of events like "Hi Fan Festival" and "Super Product Day" demonstrates the effective online and offline activities being carried out [1] - The partnership is likely to lead to the signing of more new IPs, further strengthening the company's licensing business [1]

Core Insights - The stock of Damai Entertainment (01060) has increased by over 6%, currently up 7.08% at HKD 1.21, with a trading volume of HKD 232 million [1] Group 1: Financial Performance - Sanrio reported a revenue of RMB 376 million for Q1 of FY2026 in China, representing a year-on-year growth of 120% [1] - The licensing business revenue for Sanrio in China reached RMB 251 million, showing a year-on-year increase of 158% [1] Group 2: Strategic Partnerships - CITIC Securities noted that the collaboration between Alibaba's YU and Sanrio has positively impacted the performance of both parties [1] - The partnership is expected to lead to explosive growth in licensing revenue for both Sanrio and Damai Entertainment in FY2025, with projections indicating that over 50% of YU's revenue will come from Sanrio [1] Group 3: Marketing and Events - The collaboration has seen steady progress in online and offline activities, with successful events like "Hi Fan Festival" and "Super Product Day" being held for the second time [1] - Sanrio's strong performance in China, highlighted in their financial report, indicates a solid and positive partnership, with future collaborations focusing on long-term operations and steady development [1] Group 4: Future Prospects - Marketing activities planned by YU for Sanrio are expected to provide valuable experience for the development and operation of other collaborative IPs such as Chiikawa, Crayon Shin-chan, and Universal Studios in China [1] - This experience is anticipated to serve as a strong foundation for the growth of the company's licensing business and may lead to signing more new IPs in the future [1]

Core Viewpoint - Goldman Sachs initiates a "Buy" rating for Damai Entertainment (01060) with a target price of HKD 1.38, highlighting the company's strong market position and strategic focus on live events and IP business as key drivers for sustainable growth [1] Company Performance - Damai Entertainment is recognized as China's largest live event ticketing platform and the largest IP licensing agent, positioning itself favorably across various verticals [1] - The company's stock has shown a strong performance year-to-date, with a 140% increase, indicating a market reassessment of its strategy towards live events and IP business over the more volatile film sector [1] Market Outlook - Despite the optimistic market sentiment towards the company, Goldman Sachs believes there is still room for stock price appreciation due to strong earnings growth and a focus on a more sustainable business model [1]

Investment Rating - The report assigns a "Buy" rating for the company, indicating a potential upside of 15% to 35% [9][15]. Core Insights - The company is recognized as the leading IP enterprise in China, leveraging its IP resources and R&D capabilities to provide comprehensive chip customization services from design to mass production. The growth in its volume business and new orders reflects the increasing demand driven by AI and IoT [9]. - The company is expected to benefit from the ongoing transformation in the industry, particularly as internet firms continue to invest in AI computing capabilities, enhancing their specialized processing chip (ASIC) strategies [9]. - The stock is currently trading at a price-to-sales (P/S) ratio of 11 times for 2027, maintaining the "Buy" recommendation based on significant performance potential [9]. Financial Performance Summary - For Q2 2025, the company anticipates a revenue of 584 million RMB, representing a 49.9% quarter-over-quarter increase but a 4.7% year-over-year decline. The IP licensing revenue is expected to be 187 million RMB, up 99.6% quarter-over-quarter and 17% year-over-year [12]. - The company has a robust order backlog of 3.025 billion RMB, which has remained high for seven consecutive quarters, providing a solid foundation for future revenue growth [12]. - Revenue projections for 2025-2027 are 3.067 billion RMB, 3.384 billion RMB, and 4.740 billion RMB, with year-over-year growth rates of 32%, 25%, and 23% respectively. Net profits are forecasted to be -26 million RMB, 53 million RMB, and 201 million RMB for the same period [12][11]. Shareholder Information - The major shareholder is Xinyuan Co., Ltd., holding 14.40% of the shares. The company has a total market capitalization of 47.326 billion RMB, with 525.71 million shares issued [2]. - The stock price as of August 1, 2025, was 94.49 RMB, with a 12-month high of 111 RMB and a low of 24.45 RMB [2]. Product Mix - The company's revenue composition includes 43.4% from chip volume business, 33.5% from IP licensing fees, 17.8% from chip design services, and 5.3% from royalties [4]. Market Position - The company has a significant presence among institutional investors, with 29.7% of the circulating A-shares held by funds [6]. The stock has shown a strong performance relative to the market, with a 181.7% increase over the past year [2].

Core Insights - The recent popularity of Labubu has drawn attention to the IP licensing industry, highlighted by the 2025 China International Licensing Industry Summit held in Shanghai, focusing on "Globalization and Digitalization" [1][3] Industry Growth - The licensing industry in China has rapidly developed in recent years, with the International Licensing Industry Association reporting a record global sales figure of $369.6 billion for licensed goods and services in 2024, representing a 3.7% increase from 2023 [3] - Specific sectors such as music (+11.6%), celebrity endorsements (+8.8%), fashion (+8.1%), and art (+7.4%) have shown strong growth, indicating significant potential and opportunities within the licensing industry [3] Summit Highlights - The summit gathered executives from various companies including Bandai Namco, Bilibili, and Tencent Video, featuring 8 keynote speeches and 3 roundtable discussions that addressed globalization opportunities, digital empowerment, and cultural innovation [3][4] - Over 530 representatives from brands and agencies across multiple sectors, including Adidas and NBA China, participated to discuss trends and future opportunities in the Chinese licensing industry [4] Data Analysis - The summit analyzed dynamic changes in licensing revenue across major countries and regions, as well as fluctuations in the proportions of licensed and licensed categories, providing industry benchmarks for understanding the global licensing market [6] - Discussions included topics such as licensing methods, domestic innovation and international expansion, and the rise of national cultural IPs, aiming to explore new paths for brand development and collaboration in the licensing field [6] Event Organization - The summit was co-hosted by the Global Licensing Expo Shanghai and the International Licensing Industry Association, aiming to facilitate efficient matching between IPs and brand merchants while promoting the development of the entire licensing industry chain in China [7] - Since its establishment in China in 2017, the Global Licensing Expo Shanghai has served over 1,800 IP brands and more than 200,000 professional attendees across various industries [7]