FIRST SHANGHAI released a research report maintaining a bullish outlook on POP MART (09992), citing its better-than-expected Q3 revenue performance and strong seasonal prospects for Q4. The firm raised its 2025-2027 profit forecasts to RMB13.29/19.78/25.20 billion, assigning a target price of HK$400, representing 35.8x and 24.1x P/E for FY2025 and FY2026, respectively. This implies a 75.3% upside from the current share price, warranting a "Buy" rating.

In Q3 2025, POP MART's revenue surged 245%-250% YoY, accelerating further from the 204% growth in H1 2025 despite a high base. Domestic revenue rose 185%-190% YoY, while overseas revenue skyrocketed 365%-370% YoY, exceeding expectations.

**Key Highlights:** 1. **Strong Domestic Online Performance** - Offline channel revenue grew 130%-135% YoY, driven by optimized store experiences and operational efficiency rather than rapid store expansion, sustaining doubled average store productivity. - Online revenue surged 300%-305% YoY, attributed to live-streaming e-commerce conversions, deep engagement in private traffic (e.g., blind box machines), and Q2 pre-order revenue recognition in Q3.

2. **Overseas Expansion Remains Robust, Led by the Americas** - Overseas revenue maintained rapid growth: - Asia-Pacific (ex-China): +170%-175% YoY (vs. 257.8% in H1 2025) - Americas: +1265%-1270% YoY (vs. 1142.3% in H1 2025) - Europe & others: +735%-740% YoY (vs. 729.2% in H1 2025) - POP MART expanded its global footprint, reaching 140 overseas stores by August 20, 2025, with plans to hit 200 by year-end. Future expansion targets emerging markets (Middle East, Central Europe, Latin America) and flagship stores in global hubs (Paris, Sydney, Milan, New York).

3. **Hit New Products & Diversified IP Strategy** - The Halloween-themed "Why So Serious" vinyl plush series launched on October 9 sold out rapidly, with some regular items trading at multiples of their retail price. - The "Starman" sub-series under this IP saw secondary market premiums of 99%, second only to LABUBU (215%), reflecting strong consumer demand. - The SKULLPANDA x "Wednesday" collaboration in North America became a social media sensation, boosting brand awareness.

**Q4 Seasonal Catalysts** Domestically, POP MART is poised to capitalize on major shopping festivals like "Double 11" and "Double 12." Overseas, Halloween, Thanksgiving, and Christmas are expected to drive demand for holiday-themed releases and restocks of popular items, fueling Q4 performance.

**Risks:** 1) Slower-than-expected overseas expansion; 2) Underperformance of new products; 3) Intensifying competition.