Core Viewpoint - The article discusses the financial turnaround and growth strategies of Blokus, a leading building block toy company in China, highlighting its focus on IP development and international expansion as key drivers for future success [4][6][25]. Financial Performance - Blokus reported a revenue of approximately 1.338 billion yuan in the first half of 2025, marking a year-on-year growth of 27.9%, and transitioned from a loss of 255 million yuan in the same period last year to a profit of 297 million yuan [4][5]. - The adjusted profits for 2023 and the first half of 2024 were 73 million yuan and 292 million yuan respectively, with an adjusted profit margin of 27.92% in the first half of 2024 [4]. Market Dynamics - The revenue growth rate of Blokus in the first half of 2025 slowed compared to previous years, with a significant drop from 56.1% and 47.1% in the same periods of the last two years to 27.9% this year [5]. - The company has successfully penetrated the 9.9 yuan price segment, with a notable product, the Transformers Starry Edition, selling 48.6 million units and generating over 200 million yuan in revenue within seven months [5]. International Expansion - Blokus achieved remarkable growth in overseas markets, with international revenue reaching 110 million yuan in the first half of 2025, a staggering increase of 899% year-on-year, primarily driven by North America and Southeast Asia [6][9]. - The overseas revenue accounted for 8.3% of total revenue, with Indonesia and the United States being the top contributors [9][10]. IP Strategy - The company is focusing on expanding its IP portfolio, having introduced 273 new SKUs in the first half of 2025, which accounted for 53.1% of total revenue [20][21]. - Blokus is reducing its reliance on the Ultraman IP, which contributed 63.5% of total revenue in 2023, down to 49% in 2024, and aims to diversify its IP sources [16][17]. Consumer Engagement - The company is targeting a broader consumer base, including adults and younger female demographics, with products priced between 100 to 200 yuan, resulting in an increase in revenue from consumers aged 16 and above from 10.4% to 14.8% year-on-year [21]. - Blokus emphasizes user experience and creativity, planning to host the BFC Creative Competition across 150 cities to engage consumers and enhance brand loyalty [24]. Competitive Landscape - Blokus operates in a highly concentrated market, competing with established players like Bandai Namco and LEGO, but differentiates itself with a lower price range of 3 to 16 USD [14]. - The company’s distribution strategy relies heavily on a network of over 450 distributors, covering major cities and expanding into lower-tier markets [25].

Core Viewpoint - Tianfeng Securities maintains a "Buy" rating for Blucor (00325) and forecasts net profits of 960 million, 1.48 billion, and 2.08 billion yuan for 2025-2027, with corresponding PE ratios of 50, 32, and 23 [1] Group 1: Product Launch and Market Strategy - In May, Blucor launched 9 new products, indicating a strong growth momentum expected to continue into Q2 [1] - The introduction of the Minions product line features interactive elements and a 6-city tour to enhance user engagement and brand image [2] - Blucor's global strategy is advancing, with a significant presence at the CCXP Mexico event, showcasing products from various well-known IPs to penetrate the Latin American market [3] Group 2: Community Engagement and Events - Since the announcement of the BFC creation competition in March, nearly 8,000 events have been held across 120 cities, with participation increasing significantly in Q2 [4] - The company plans to expand the BFC competition to 20,000 events in 150 cities by 2025, utilizing a tiered approach for urban and suburban areas [4]

Investment Rating - The report assigns a "Buy" rating to the company [4][7]. Core Insights - The company, Bluku, is the leading player in China's building block character toy market, achieving explosive growth through product transformation and channel expansion, with a GMV of approximately 1.8 billion CNY in 2023, capturing 30.3% of the building block character toy market share [1][2][13]. - The building block character toy market in China is expected to grow at a CAGR of 41.3% from 2023 to 2028, with the market size projected to exceed 32.5 billion CNY by 2028 [2]. - The company's success is driven by a robust IP matrix, including over 50 popular licensed IPs and proprietary IPs, alongside a strong focus on cost-effective product development and deep channel penetration [3][4]. Summary by Sections Company Overview - Bluku is recognized as China's largest building block character toy manufacturer, with a revenue structure heavily reliant on building block character toys, which accounted for 98.2% of revenue in 2024 [1][17]. - The company has seen rapid revenue growth, with a CAGR of 89% from 2021 to 2024, driven by the expansion of its distribution channels and the popularity of its IPs [30]. Market Analysis - The building block character toy market is highly concentrated, with the top five companies holding a combined market share of 77% in 2023, and Bluku leading with a 30.3% share [2]. - The global building block toy market is dominated by companies like Bandai and LEGO, indicating a competitive landscape that local companies must navigate [2]. Growth Strategy - Bluku's growth strategy includes leveraging its IP portfolio, which features successful franchises like Ultraman and Transformers, and enhancing its product offerings through technological innovation and user engagement [3][4]. - The company has established a comprehensive distribution network, with 511 distributors covering major cities and over 80% of lower-tier cities, resulting in a significant increase in offline sales [3][23]. Financial Projections - Revenue forecasts for Bluku indicate substantial growth, with expected revenues of 3.91 billion CNY in 2025, 5.61 billion CNY in 2026, and 7.40 billion CNY in 2027, reflecting year-on-year growth rates of 74%, 43%, and 32% respectively [4][9]. - The company's net profit is projected to turn positive by 2024, driven by its focus on high-margin building block character toys and effective cost management strategies [51].