China Merchants Securities: Maintains "Strong Buy" investment rating for POP MART, expects to release Q3 2025 report soon
China Merchants Securities maintains a "Strong Buy" investment rating for POP MART, expecting a year-on-year revenue growth of 154.2% in the third quarter of 2025, with a quarter-on-quarter growth of approximately 8.9%, amounting to an absolute value of 9.17 billion yuan. Adjusted net profit is expected to grow by 198.6% year-on-year, with an absolute value of 3.03 billion yuan. The earnings forecast for 2025-2027 has been raised to 10.96/14.92/18.31 billion yuan, respectively
According to the Zhitong Finance APP, China Merchants Securities has released a research report maintaining a "strong buy" investment rating for POP MART (09992). Considering 1) the overseas organizational structure promotes healthy and sustainable growth abroad; 2) the strong potential of IP products such as "Elf Team" LABUBU and Xingxingren, the profit forecasts for 2025-2027 have been raised, with adjusted net profits expected to be 10.96 billion, 14.92 billion, and 18.31 billion yuan respectively (previous values were 10.37 billion, 14.21 billion, and 17.36 billion yuan), corresponding to adjusted PEs of 32.3x, 23.8x, and 19.4x for 2025-2027.
From 2022 to 2024, the company released information on its recent business conditions for the third quarter on October 25th, 24th, and 22nd respectively, and it is expected that the company will soon release its business conditions for the third quarter of 2025. Considering the strong momentum of new product launches and continuous growth across various channels, assuming that the adjusted net profit for Q3 2025 accounts for 27.5% of the annual adjusted profit (assuming the profit margin for Q3 2024 is the same as that for Q4 2024, which corresponds to a profit share of 29.8% for Q3 2024, considering the impact of new product launches and restocking rhythm in the first half of 2024, it is assumed that the proportion declines year-on-year; assuming the profit margin for Q2 2025 is the same as that for Q1 2025, the corresponding proportion would be 25.9%), and assuming an adjusted profit margin of 33%, the bank expects that the company's revenue in Q3 2025 will grow by 154.2% year-on-year and approximately 8.9% quarter-on-quarter, with an absolute value of 9.17 billion yuan; the adjusted net profit is expected to grow by 198.6% year-on-year, with an absolute value of 3.03 billion yuan (the third quarter only discloses the range of operating revenue growth, and the absolute values and year-on-year profit forecasts are for reference only)
