China Merchants Securities released a research report stating that Pop Mart (09992) issued a profit forecast, greatly exceeding expectations, with a year-on-year revenue growth of no less than 55% in 2024H1. Based on the lower limit calculation, the revenue of 2024H1 is 4.36 billion. The group's net income (excluding the unrealized gains and losses of financial instruments that have not been completed for statistics) is expected to increase by no less than 90% year-on-year, with a lower limit calculation of 0.907 billion and a net profit margin of 20.8%, a year-on-year increase of 3.8 percentage points.
In terms of profit, the company continues to optimize product costs, strengthen cost control, and improve profitability. The scale effect has greatly increased the excess income. In addition, considering that the overseas unit price is relatively high and the profitability of a single store is relatively high, the bank expects that the growth in overseas business volume will also help to continue to improve the profit margin.
The bank mentioned that considering: 1) Pop Mart's IP global recognition continues to increase, overseas market development is smooth; 2) Domestic market demand continues to recover, and the company actively expands new product categories on the supply side; 3) The overseas business has a relatively high gross profit margin while strengthening product cost and expense control. The bank raised the company's adjusted net income for the years 2024-2026 to 1.9/2.55/3.25 billion yuan (the original forecast was 1.63/2.08/2.57 billion yuan), corresponding to a PE valuation of 26.8/20.0/15.7x, and maintained a "strongly recommended" investment rating.