CICC: Maintains "outperform" rating on POP MART (09992) with a target price of HK$218.

CICC released a research report saying that it maintains the adjusted net profit forecast for POP MART (09992) in 2026/2027 at 13.3/15.5 billion yuan. The current stock price corresponds to a 26/27 times adjusted P/E ratio. As a global leader with scarcity and broad space, the company is currently at a historically low valuation. In the short term, it has potential event catalysts, and in the medium term, performance improvement can be expected. It reiterates that it is the first recommended stock in the sector, maintains an "outperform industry" rating, with a target price of HKD 218, corresponding to a 19/16 times adjusted P/E ratio for 2026/2027, representing a 19% upside potential from the current level. Key points from CICC: Company Overview At the opening ceremony of the 2026 FIFA World Cup in the United States, Canada, and Mexico, LABUBU made its debut as the first third-party IP in the history of the World Cup, attracting extensive coverage and discussion. The event is expected to boost the awareness of LABUBU and POP MART in the Americas and even the global market, marking a new height in the globalization of Chinese IP trendy companies. Strengthening awareness in the Americas through world-class events and IP asset consolidation The World Cup, held every four years, has a wide-ranging global impact. In April, POP MART launched the LABUBU joint FIFA series products, and in May, it participated in the shooting of the official MV, showcasing the company's stronger content integration capabilities and IP operation comprehensive strength in dance, music, and other unified arrangements. This appearance is expected to bring wide exposure to LABUBU globally, and as the event is jointly hosted by the three countries in the Americas, it is expected to lay a solid foundation for the spread of LABUBU in the Americas and further consolidate IP assets, driving the company and the Chinese trendy IP industry to new heights of globalization. Steadily expanding commercial resources to support long-term IP development Following the global popularity of LABUBU last year, CICC believes that the company has accumulated valuable operational experience and high-quality global commercial resources. In addition, from last year's Macy's Thanksgiving Day Parade to this year's Coca-Cola tripartite joint name, the company's global commercial resources are becoming more prominent, which is expected to quickly increase IP exposure, drive fan community breakthroughs, and long-term development. The company has also continued to promote IP operation and fan sedimentation through activities such as performance art and city exhibitions since last year, constantly improving the long-term health and value of the IP. Adjustment measures are gradually implemented, waiting for subsequent effects Since the beginning of the year, the company has steadily implemented measures such as store adjustments, product planning, and member system construction after setting the tone of "entering maintenance mode." At the organizational level, the continuous optimization of the four-region coordination mechanism and the design of the headquarters middle platform empower each region to help localize IP operations. From the perspective of new products, the company actively controls the rhythm of top IP launches, reduces IP consumption, and polishes better designs for recharging in the second half of the year. With the effectiveness of the adjustments becoming apparent, CICC expects overseas performance to gradually improve from Q3, with still ample room for long-term growth. Risk warning: Product development and supply chain expansion may not meet expectations.