POP MART: No Longer a Playground for Hedge Funds, but Interesting for Long Money?

Key Takeaways

• POP MART shares fell >30%, erasing ~US$13bn market value
• Overseas revenue growth slowed from 440% to 243% YoY in H2 2025
• Labubu now 38% of revenue, but new IP Twinkle Twinkle surged 1,600%
• Management guided “no less than 20%” growth, prompting valuation drop
• Long‑term investors like Duan Yongping now view POP MART favorably

Pulse Analysis

POP MART’s recent share‑price plunge illustrates the volatility that can accompany hyper‑growth firms when expectations outpace guidance. After reporting a 185% revenue jump to about US$5.2 billion in 2025, the company warned of “no less than 20%” growth—a figure that investors interpreted as a cautious ceiling rather than a floor. Coupled with a slowdown in overseas revenue acceleration—from a 440% year‑over‑year surge in the first half to 243% in the second half—the market erased roughly US$13 billion in market cap. This reaction highlights how even modest guidance can trigger a re‑rating when a stock has been propelled by speculative, hedge‑fund activity.

Nevertheless, POP MART’s fundamentals remain robust. Greater China sales grew 135% year‑over‑year, essentially unchanged in the second half, confirming the domestic market as a reliable growth engine. The company’s IP portfolio is diversifying: Labubu accounts for 38% of revenue, but newer characters like DIMOO, SKULLPANDA, CRYBABY and especially Twinkle Twinkle—up 1,600% YoY and now 5.5% of sales—show that the business can generate fresh revenue streams. This breadth reduces the risk of over‑reliance on a single franchise and supports a longer‑term growth narrative.

Investor sentiment is also shifting. High‑frequency hedge funds have retreated, while long‑term capital stewards such as Duan Yongping, often called the “Buffett of China,” are publicly endorsing POP MART as a “right business, right price.” Their involvement suggests confidence in the company’s brand moat, operational discipline, and shareholder‑friendly policies like recent share buybacks. As POP MART transitions from a high‑multiple growth story to a stable, low‑multiple value play, its valuation may become more anchored to earnings growth rather than speculative upside, offering a clearer path for patient investors.