POP MART(09992) 国信证券·2024-11-26 04:56Investment Rating - The report maintains an "Outperform" rating for the company [2] Core Views - The company is the largest and fastest-growing enterprise in the trendy toy industry, with a strong IP-centric strategy and successful overseas expansion, contributing nearly 30% of revenue by H1 2024 [4] - The trendy toy market in China has grown from 6.8 billion yuan in 2015 to 60 billion yuan in 2023, with a CAGR exceeding 30%, and the company holds an 8.5% market share, ranking first [4] - The company's IP development, operation, and supply chain capabilities are leading, with a membership base of 38.93 million by H1 2024, contributing over 90% of sales and a repurchase rate of around 45% [5] Business Overview - The company has a comprehensive IP matrix, with core IPs like SKULLPANDA, MOLLY, DIMOO, and THE MONSTERS showing strong growth and long lifecycles [5] - The company's IP commercialization success rate is high, and its category expansion strategy, including games, theme parks, plush toys, and building blocks, has been well-received [6] - Overseas revenue has shown phenomenal growth, with stores opened in over 20 countries/regions, and overseas revenue accounting for nearly 30% by H1 2024 [6] Growth Drivers - The company's IP commercialization success rate is high, and its category expansion strategy has driven rapid same-store growth domestically [6] - Overseas revenue has shown phenomenal growth, with sufficient space for further store openings, and cultural export has been smooth [6] - The company's membership system, with 38.93 million members by H1 2024, contributes over 90% of sales and has a repurchase rate of around 45% [5] Financial Performance - The company's revenue and net profit have maintained rapid growth, with a 62% YoY increase in revenue to 4.56 billion yuan in H1 2024 [60] - The company's gross margin has remained above 60%, with a net margin recovering to over 15% by H1 2024 [69] - The company's operating cash flow has shown a clear upward trend, reaching 1.91 billion yuan in H1 2024 [74] Industry Overview - The trendy toy market in China has grown from 6.8 billion yuan in 2015 to 60 billion yuan in 2023, with a CAGR exceeding 30%, and is expected to reach 110 billion yuan by 2026 [17] - The market concentration in China's trendy toy industry is low, with the company holding an 8.5% market share, ranking first [22] - Consumers' primary reasons for purchasing trendy toys are the element of surprise and their love for the IPs, with 46.78% of consumers citing surprise and 38.95% citing IP as their main motivations [27] Valuation and Investment Recommendation - The report forecasts adjusted net profits of 2.61 billion yuan, 3.51 billion yuan, and 4.24 billion yuan for 2024-2026, representing YoY growth of 141%, 35%, and 21%, respectively [138] - The company's absolute valuation is estimated at 91.1-112.1 HKD, with a relative valuation of 84.2-103.6 HKD, based on a 2025 PE multiple of 30-40x [149]