HK Stock Market Move | BLOKS(00325) rose by over 6%. The success of "Ne Zha 2" is beneficial to the grain industry chain. The company's SKU is comprehensively enriched.

BLOKS (00325) rose more than 6%, reaching a 6.63% increase to HK$88.5 as of press time, with a trading volume of HK$50.3383 million. In terms of news, Tianfeng believes that the hot sales of Ne Zha 2 and its popularity in the market have positive implications for the domestic IP grain industry chain, potentially opening up a new era of development. The company has its own IP Hero Infinite series, including Ne Zha/Aobing/Shen Gongbao and other series of building block figures, with a comprehensive range of SKUs; benefiting from the continued popularity of Ne Zha 2, peripheral products are in short supply (such as POP MART's "Ne Zha Demon Child Making Trouble in the Sea" series of blind box figures). The company expects that the sales of Ne Zha-related products in the BLOKS Hero Infinite series may drive revenue and performance growth. Pacific Securities pointed out that, on the industry side, driven by multiple factors on both the supply and demand sides, the global and Chinese construction character toy industry has a broad growth space, with CAGRs of +29.0% and +41.3% expected for 2023-2028 respectively. On the company side, as one of the industry leaders, the company is expected to benefit from the growth dividend; with rich IP and SKUs and high product quality, construction character toy popular IP Ultraman is driving the company's revenue and profit growth, and other IPs in the future are expected to replicate successful strategies to achieve performance improvement, with diversified revenue pillars expected to further reduce the risk of being overly reliant on a few popular products.