Pop Mart, the Beijing-headquartered company, behind the mega viral Labubu plush dolls has issued very bullish earnings forecast.
In a regulatory filing to the Hong Kong stock exchange, the Chinese company said that it expects at least 350 percent increase in the profit.
The company also said that it hopes for a 200 percent revenue growth in first half of this year. However, the stocks of the company tanked six percent on Wednesday.
Jeff Zhang, an equity analyst at Morningstar, told CNBC that this may because many feel that the earnings have already peaked in H1 and there may be a ‘slowdown starting in H2’.
While the stock market movement remains volatile, the company’s stellar run is not stopping anytime soon. At present, Pop Mart’s market capilatisation exceeds $39 billion.
In the filing to the Hong Kong exchange, Pop Mart said that the solid growth forecast is due to wider 'global recognition' of intellectual properties and brand. Apart from Labubu, Popmart's other bestsellers include Crybaby and Molly dolls.
Chinese soft power expansion
As the tariff-induced volatility impacts global trade, countries are increasingly looking for soft power playbook. The US had Hollywood and sheer dominance of pop culture back in 90s.
But one look at the memverse and one can sense the shift. If South Korea has BTS, K-pop, and India has Bollywood, China is growing influence with Labubus, one purchase at a time. The numbers tell the story.
In H1 of 2024, Pop Mart registered 93.3% growth in profit to $128.4 million, while company’s revenue grew 62% to 4.6 billion yuan. As per a CNBC report, Pop Mart’s stock prices have almost tripled year to date.
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