Labubu puppets fly on the stock exchange, manufacturer Pop Mart up 595%
Five investment banks revise their stock valuations. Value tripled in one year
2' min read
2' min read
From pop phenomenon - with monstrous queues at 8 a.m. to grab as many as possible - to collector's item. However you want to read the success of Labubu - the 'monsters' dolls to be attached to backpacks and handbags - the rebound is mainly on the stock exchange.
At least five investment banks - including Deutsche Bank AG and Morgan Stanley - have this week revised upwards their estimates on the stock of the Hong Kong-listed manufacturer, Pop Mart International Group Ltd, due to the global success of its Labubu dolls. Citigroup Inc increased its target price by as much as 90 per cent to a high of HK$308 per share. Pop Mart's shares rose as much as 3.5 per cent on Friday, closing at +2.17 per cent. But the one-year change was also a record: +595.27 per cent.
From gadget to lifestyle phenomenon
.Until recently, it was the free gift to current account holders who deposited 6,000 euro for three months in an account at the Chinese Ping An Bank. A gadget like so many others that has turned into a phenomenon of custom.
It is, in fact, a small puppet of a few centimetres, with a spirited look and sharp, coloured teeth, sold in blind-boxes, i.e. surprise boxes in different versions. This was the driving force behind the purchases. Moreover, the fact that in each series there is at least one 'Labubu secret' - extremely rare - has prompted collectors but also those aiming at reselling, up to 500 euros for a specimen. For the company, this translated into more than 3 billion yuan (about 360 million euro) in sales for Pop Mart last year, which accounted for almost a quarter of its turnover.
Overbought stock
.Pop Mart is trading above the 12-month average target price tracked by Bloomberg, and the rally has pushed the stock into overbought territory. Although valuations at 45 times future earnings have surpassed those of competitors such as Sanrio Co. and Walt Disney Co., some analysts are optimistic that the stock can continue to climb after tripling so far this year. The stock is the best-performing stock in the MSCI China index this year, having been among the index's biggest winners in 2024.
