Understanding the Market | POP MART rises over 4% again, Labubu remains in short supply, and the new IP "Star People" is rapidly emerging

POP MART rose over 4% again, as of the time of writing, up 4.25% to HKD 284.2, with a trading volume of HKD 882 million. JP Morgan released a research report stating that it has upgraded POP MART's rating from "Neutral" to "Overweight," and raised the target price from HKD 300 to HKD 320. JP Morgan's adjustment is mainly based on two key factors: first, the continued strong performance of popular IPs; although Labubu's production capacity has increased tenfold compared to the first quarter, Labubu 3.0 and Mini Labubu remain sold out in all regions. Additionally, the new IP "Star People" is rapidly rising and is expected to contribute 8% of sales in 2027; second, the valuation attractiveness has significantly improved, as POP MART's stock price has corrected 24% from its August peak, while the Hang Seng Index has risen 7% during the same period. Currently, JP Morgan forecasts only a 20 times price-to-earnings ratio for 2026, making the risk-reward ratio more attractive