Core Viewpoint - The company, Pop Mart, is expected to report significant growth in its first half performance, with revenue projected to increase by no less than 200% year-on-year, reaching at least 13.67 billion yuan, and net profit expected to grow by no less than 350%, amounting to at least 4.34 billion yuan, exceeding market expectations [1] Group 1: Performance Drivers - The substantial year-on-year growth in the company's performance is primarily attributed to the global recognition of its IPs, which has led to a diverse range of product categories driving rapid revenue growth across various regions [1] - The increasing proportion of overseas revenue has positively impacted both gross and net profit margins, alongside scale effects enhancing overall profitability [1] - Continuous optimization of product costs and strengthened expense management have contributed to improved profitability [1] Group 2: Product and IP Development - The LABUBU pre-sale has been highly successful, with the first batch of inventory selling out and a significant contribution expected to the annual performance from the re-listed products [2] - New IPs are emerging, with the company's IP incubation and operational capabilities being validated, particularly with CRYBABY showing strong potential in the Thai market [2] - The company is expanding its product lines to further explore IP value, including the launch of the independent accessory brand POPOP and the preparation of a small appliance product line [2] Group 3: Future Outlook - The company has demonstrated its long-term operational capabilities for IPs, reducing reliance on a few key IPs, which enhances the sustainability of its performance [3] - The profitability of overseas operations is high and growing rapidly, especially in the U.S., where price increases are expected to further enhance regional gross margins [3] - The company has revised its revenue and net profit forecasts for 2025-2027, projecting revenues of 35.1 billion, 53.5 billion, and 69.1 billion yuan, and adjusted net profits of 11.2 billion, 17.8 billion, and 23.8 billion yuan respectively, indicating strong growth potential [3]

Investment Rating - The report maintains an "OUTPERFORM" rating for Pop Mart International [1] Core Views - The company's performance in the first half of 2025 exceeded expectations, with revenue projected to grow by no less than 200% year-on-year, and net profit expected to increase by no less than 350% [12] - The growth is attributed to the global recognition of Pop Mart's IP, diversified product categories driving revenue growth across regions, and improved cost management enhancing profitability [2] Financial Summary - Revenue projections for 2025-2027 are RMB 35.1 billion, RMB 53.5 billion, and RMB 69.1 billion, representing year-on-year growth of 169%, 53%, and 29% respectively [5] - Adjusted net profit estimates for the same period are RMB 11.2 billion, RMB 17.8 billion, and RMB 23.8 billion, with corresponding growth rates of 229%, 58%, and 34% [5] - The gross profit margin is expected to improve from 66.8% in 2024 to 74.9% by 2027 [11] Market Position and Strategy - The company has successfully expanded its IP portfolio, with new IPs like CRYBABY gaining traction, indicating a reduced reliance on a few key IPs [4] - The overseas business is growing rapidly, particularly in the U.S., where price increases are expected to enhance regional gross margins [4] - The launch of new product lines, including the independent accessory brand POPOP, aims to broaden the customer base and explore IP value [3]