Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of HKD 321.9 [2][8]. Core Insights - The company's H1 2025 performance exceeded expectations, with revenue growth projected to be at least 200%, corresponding to revenue of at least HKD 13.67 billion. The group's profit growth is expected to be at least 350%, corresponding to a profit of at least HKD 4.34 billion, with a profit margin of approximately 31.7%, an increase of 10.6 percentage points year-on-year [2][8]. - The report highlights the ongoing enhancement of brand momentum and the successful expansion of the IP ecosystem, with new product launches receiving positive market feedback [2][8]. - The company is expected to continue its impressive performance in the domestic market while expanding its presence in overseas markets, supported by the influence of celebrity endorsements [2][8]. Financial Summary - Projected total revenue for 2024 is HKD 13.04 billion, with a year-on-year growth rate of 105.5%. By 2025, revenue is expected to reach HKD 30.05 billion, reflecting a growth rate of 130.5% [4][9]. - The projected net profit for 2024 is HKD 3.13 billion, with a year-on-year growth rate of 188.8%. By 2025, net profit is expected to increase to HKD 9.38 billion, with a growth rate of 200.1% [4][9]. - The report anticipates a steady increase in earnings per share (EPS), projected at HKD 2.33 for 2024, rising to HKD 6.98 in 2025 [4][9].

Core Viewpoint - The 2025 LEC Global Licensing Expo showcased the booming toy and trendy play market, highlighting significant growth in both domestic and international markets, with a focus on diverse product categories and the integration of cross-industry IP collaborations [1][2]. Industry Overview - The toy market in China is projected to reach a scale of 877 billion yuan by 2025, with exports of dolls and animal toys exceeding 13.31 billion yuan in the first four months of 2023, marking a 9.6% increase [1]. - The trendy play market is experiencing expansion in two dimensions: diversification of product categories and accelerated integration of cross-industry IP collaborations [1][2]. Company Activities - Companies are increasingly investing in the trendy play market, with notable transactions including Quantum Song Group's acquisition of a 61% stake in Shenzhen Yiqi Culture for 235 million yuan and investments by Wanda Film and Reading Group in various trendy play enterprises [1][2]. - The investment in "Super Vitality Factory," a plush toy brand, marks the first instance of a mainstream investment institution entering the plush toy industry in China [2]. Product Diversification - The market is shifting from a focus on blind box competition to a more diverse range of products, with companies like Pop Mart and 52TOYS expanding their offerings to include plush toys, action figures, and various collectibles [2]. - 52TOYS has developed a product range that includes static figures, movable toys, and plush toys, covering 2,800 SKUs, and emphasizes the importance of IP style and differentiation in product development [2][4]. IP Strategy - 52TOYS operates on a model of "self-owned IP operation + authorized IP cooperation," with 35 self-owned IPs and 80 authorized IPs expected to generate 24.5% and 64.5% of revenue, respectively, by the end of 2024 [4]. - The ability to successfully launch original IPs and creatively develop authorized IPs is seen as a competitive advantage in the evolving market landscape [4]. Future Trends - The competition in the trendy play market will increasingly depend on how brands enrich their IP ecosystems, with companies exploring various content forms such as animation and literature to enhance brand presence [4][5]. - The establishment of theme parks and the development of original animations are strategies being employed by leading companies like Pop Mart to deepen the impact of their original IPs [4].

Core Viewpoint - The LABUBU brand, a top-tier IP in the trendy toy industry, has recently gained significant popularity, raising questions about the sustainability of this trend and the reasons behind its sudden success [2][4]. Group 1: LABUBU's Success Factors - LABUBU's success is attributed to the emotional value consumption model, which combines emotional value, ecological closure, and industrial synergy to create a long-term lifecycle for the IP [2]. - The brand leverages community co-creation to enhance IP value, transforming consumers into IP dissemination nodes through various social activities, such as customizing toys and creating unboxing videos [2]. - A brand stratification strategy, along with global and local market adaptations, has laid a solid foundation for LABUBU's popularity, with product prices ranging from tens to thousands of yuan, catering to a broad consumer base [3]. Group 2: Market Expansion and Performance - In the past two years, LABUBU has adopted a localized "going global" strategy, launching region-specific limited editions that have garnered international attention, resulting in a 475% to 480% year-on-year increase in overseas business revenue in Q1 2025 [3]. - As of the end of 2024, the company has opened over 500 stores in more than 30 countries and regions, reaching over 90 countries through various cross-border e-commerce platforms [3]. Group 3: Supply Chain and Production Capacity - The Guangdong-Hong Kong-Macao Greater Bay Area provides a robust industrial chain support for LABUBU, with a complete toy supply chain in Dongguan ensuring stable production capacity, which has reached 10 million units per month by 2024 [3]. - The collaboration with artist Long Jia-sheng from Hong Kong infuses cultural elements into the IP, enhancing its appeal and marketability [3]. Group 4: Longevity and Cultural Transformation - Despite concerns about the lifecycle of trendy toy IPs, LABUBU's potential for longevity is linked to its narrative depth and the creation of a comprehensive universe that includes other characters, thereby extending user engagement [4]. - The success of LABUBU reflects a broader trend of Chinese manufacturing transitioning towards cultural creation, integrating design, manufacturing, and global operations to transform niche art into mainstream emotional symbols [4].

Group 1 - The Monsters convenience store opened its first exhibition in East China at Shanghai's Kerry Center, attracting a large number of fans and visitors [1][6] - The pop-up event required reservations starting from June 12, with slots quickly being sold out each day [3][5] - Limited edition products were offered at the pop-up store, with prices ranging from 59 to 299 yuan, including popular items like plush keychains and seafood skewers [9][11] Group 2 - Fans traveled long distances, with some driving for 7 hours from Hefei to pick up their purchases, highlighting the strong demand for the products [8][6] - A long queue formed for the capsule toy vending machines, with some customers arriving as early as 5 AM to secure their purchases [12][14] - The LABUBU brand has gained significant popularity, leading to a surge in search interest and the emergence of rental services for its figures on second-hand platforms [16][19]

Core Insights - The release of Labubu's new products from the "THE MONSTERS" series by Pop Mart has led to a significant demand, resulting in immediate sellouts both online and offline [1][2][5] - The phenomenon of scalping has emerged, with scalpers using various methods to purchase the products in bulk and resell them at inflated prices, raising concerns about market order and consumer rights [2][5][6] Product Launch and Demand - On June 12, Pop Mart launched new products including the Labubu THE MONSTERS series figurines priced at 66 yuan and the Labubu shrimp earphone bag priced at 99 yuan, which sold out quickly [1] - The following day, the Labubu blind boxes were also sold out in physical stores and vending machines, indicating high consumer interest [1][2] Scalping and Market Impact - Reports indicate that scalpers are using software and occupying vending machines to buy out the products, leading to conflicts with regular consumers [2][3][4] - The resale prices for the THE MONSTERS series figurines range from 80 yuan to 1300 yuan, while the shrimp earphone bags are sold for over 100 yuan to more than 1000 yuan on secondary platforms [5] Legal Concerns and Recommendations - Legal experts have noted that the actions of scalpers may violate multiple laws, including the potential for criminal charges if the behavior is deemed severe [2][6][7] - Recommendations include implementing purchase limits and real-name verification on e-commerce platforms to curb scalping, as well as the need for legislative measures to define and penalize scalping behavior [6][7]

Core Viewpoint - The recent popularity of the domestic toy brand LABUBU has led to a global frenzy, with products selling out quickly and prices doubling in the secondary market, attracting attention from international celebrities [1][15]. Group 1: Sales and Demand - LABUBU plush toys and keychains have seen overwhelming demand, leading to long queues and even altercations at physical stores in South Korea [1][6]. - The company announced a temporary halt to offline sales of LABUBU products due to safety concerns arising from the chaotic purchasing environment [6]. - In China, the opening of The Monsters convenience store in Shanghai saw appointment slots for entry sell out instantly, with customers needing to pay a nominal fee to secure a spot [9][11]. Group 2: Market Dynamics - The demand for LABUBU products has resulted in significant price increases in the secondary market, with some items being resold for over 1,000 yuan, compared to their original price of 199 yuan [15]. - A rare LABUBU collectible was sold at an auction for an astonishing 1.08 million yuan, highlighting the brand's growing value and desirability among collectors [17].

Core Insights - The LABUBU series of convenience stores by Pop Mart has gained significant popularity, creating a global trend [2][3][4][5] Group 1 - The first exhibition of the LABUBU series in South China was held on June 13 in Tianhe District, Guangzhou, attracting many visitors [2][3][4][5] - The event drew crowds of fans who engaged in photo opportunities and social media check-ins [2][4][5] - The LABUBU brand has recently experienced a surge in popularity, indicating strong market interest and engagement [3][4][5]

Group 1 - The core event is the launch of the LABUBU convenience store pop-up in Chengdu, marking its first exhibition in Southwest China, alongside similar launches in Beijing, Shanghai, and Guangzhou [1][4] - The pop-up event started on June 13 and required reservations, which were fully booked almost immediately [4][10] - The popularity of the LABUBU brand is attributed to its appealing design that resonates with young consumers, showcasing a blend of cuteness and a 'bad' contrast [5][8] Group 2 - Chengdu is positioning itself as a hub for the "first launch economy," attracting numerous international and trendy brands [8][10] - The city has initiated a three-year action plan to promote the first launch economy, aiming to establish 6,500 new stores and host over 1,000 launch events by the end of 2027 [10][11] - Since 2019, Chengdu has welcomed over 4,000 new stores, with a record of 820 new stores expected in 2024, indicating a consistent growth trend [11]

Core Insights - The opening of the Pop Mart flash store in Guangzhou on June 13 attracted a large number of fans and scalpers, leading to a high demand for the LABUBU toys, which are part of a globally trending IP [2][16] - Scalpers created a temporary trading market in a nearby tea shop, selling the toys and entry qualifications at significantly inflated prices [2][26] - The entry qualification for the flash store was sold out almost instantly, with prices in the secondary market ranging from 200 to over 900 yuan [6][8][16] Group 1: Market Dynamics - The LABUBU toys, particularly the "怪味便利店" series, have seen prices soar, with a plush keychain originally priced at 199 yuan being sold for as much as 2500 yuan [16][26] - Fans from various regions, including Hong Kong and Xinjiang, traveled to Guangzhou to purchase the toys, indicating a strong regional interest and demand [6][16] - The flash store's entry qualifications were sold out within seconds, leading many to resort to the secondary market for purchases, further driving up prices [8][16] Group 2: Consumer Behavior - Consumers expressed willingness to pay high prices for entry qualifications and products, with some individuals spending up to 600 yuan just to gain access to the store [6][16] - The presence of professional players and scalpers has created a competitive environment, where individuals are actively seeking to buy and sell products at inflated prices [28] - The trading market in the tea shop was bustling, with buyers negotiating prices and expressing interest in various LABUBU products, showcasing the high demand and enthusiasm for the brand [26][28]

Group 1 - The Hang Seng Consumption Index (HSCGSI) decreased by 1.22% as of June 13, 2025, with mixed performance among constituent stocks [1] - Six brands, including Luk Fook Holdings (00590) and Chow Tai Fook (01929), saw significant gains, while Youbao Online (02429) led the declines [1] - The Hang Seng Consumption ETF (159699) recorded a turnover of 3.61% during the session, with a total transaction value of 48.83 million yuan [1] Group 2 - As of June 12, 2025, the top ten weighted stocks in the Hang Seng Consumption Index accounted for 60.97%, with Pop Mart (09992) having the highest representation [2] - Pop Mart launched a new product series, Labubu, which sold out quickly, indicating strong consumer interest [2] - A report from Galaxy Securities suggests a "dual consumption structure" is emerging in China, reflecting a deep restructuring of the consumption market [2] Group 3 - Guotai Junan Asset Management views the current new consumption trend as a manifestation of "consumption downgrade," highlighting the need to monitor competitive dynamics in the market [3] - The report emphasizes that some new consumption stocks may lack competitive barriers, suggesting a potential mismatch between supply and demand [3] - The "new consumption" sector is gaining popularity and attracting significant investment, showing clear "track characteristics" [3] Group 4 - The Hang Seng Consumption ETF (159699) offers T+0 trading and provides an easy way to invest in Hong Kong's new consumption sector [4]