Labubu has started to fall! The bull buyback price has slumped by 50%.

"Peak" or "a quick rebound"?

Written by: Zhao Ying

Source: Wall Street Journal

With an official sale that exceeded expectations, Labubu is experiencing a shift from being bought up at dozens of times the price to having its second-hand price halved overnight. The market sentiment towards Pop Mart has also turned from fervent support to panic selling.

Just a week ago, Labubu was still "hard to come by", with scalpers monopolizing the supply using抢单软件, reselling at a markup of 10 to 30 times and still finding buyers. However, from June 18 to 19, the situation underwent a dramatic reversal.

On the evening of June 18, the official Pop Mart mini program restocked the Labubu "High Energy Ahead" series with unprecedented strength and opened the online pre-sale channel for the first time.

The official "generosity" instantly ignited the second-hand market. According to data from a trendy toy second-hand trading platform, the prices of the Labubu series have generally plummeted by about 50%.

The market has begun to question the sustainability of the popularity of this IP, and some investors believe that Labubu will repeat the fate of the violent bear. Influenced by this news, Pop Mart's stock price fell over 5% today!

A "routine restock" turned scalpers from huge profits to losses

On June 18, a "routine restock" by Pop Mart triggered an earthquake in the second-hand market.

Data shows that this restock has caused a crash in second-hand prices: according to data from a trendy toy resale platform, the prices of the Labubu series have generally plummeted by about 50%. Previously inflated to a recovery price of 1500 yuan to even 2800 yuan for a whole box (6 blind boxes), it has now dropped sharply to the range of 650-800 yuan. Even the rare hidden version "Ben Wo" has seen its price drop from a high of 4600 yuan to around 2800 yuan, a drop of more than 38%.

On social media platforms, consumers who once struggled to place orders are now sharing screenshots of their successful purchases. Some consumers say: it feels like the quantity and frequency of restocks this time far exceed previous ones, and the official really wants fans to be able to buy them.

In the once bustling scalper community, the atmosphere has dropped to freezing point. The 1200 yuan pre-sale orders listed by sellers are going unnoticed, replaced instead by low-price calls of "700 yuan can be collected."

Some scalpers lost tens of thousands in a single day due to the sudden drop in prices, and this dramatic reversal has made netizens gloat: seeing scalpers lose money makes me happier than making a profit.

This "ugly-cute" elf, which has driven global top stars like Rihanna and Beckham crazy, is experiencing its first price crash since its inception—this may just be the beginning of the test for the 350 billion HKD market value myth of Pop Mart.

Market Discussion: "Reaching the Peak" or "a quick rebound"?

The doubts faced by Labubu come not only from price fluctuations but also from a fundamental skepticism about the sustainability of its IP popularity. Investors are starting to compare it with historical phenomenon-level IPs, looking for signs of decline.

The previous article pointed out that, based on internet popularity data, such concerns are not unfounded. The popularity of the violent bear lasted for 2 years from 2020 to 2022; whereas the hot title "Black Myth: Wukong" from last year only maintained its popularity for less than 3 months; and Nezha during the Spring Festival similarly only had around 3 months of high visibility.

There are analyses indicating that there are four common signals for four types of young people speculating on asset peaks: first, media & search popularity peaks first; second, producers take advantage of high prices to significantly release goods; third, the price gap of "high-end firm - mid-end collapse" widens; fourth, liquidity stagnation occurs. LABUBU is highly likely to repeat the paths of AJ, Violent Bear, etc. within the next 6 to 12 months, experiencing a ≥50% pullback after prices are overestimated by emotions, with an objective probability of about 95% (±10 percentage points).

However, supporters have proposed a different frame of reference, comparing Pop Mart with another company that also relies on core fans and an IP ecosystem—Nintendo.

Analyzing the comparison between Pop Mart and gaming giant Nintendo: Nintendo has 106 million annual active users, a market value of approximately 850 billion RMB, revenue of 78 billion RMB, and a price-to-earnings ratio of 61 times; while Pop Mart has 46.08 million registered members, a member repurchase rate of 49.4%, an expected price-to-earnings ratio of 56 times in 2025, and an anticipated profit growth of over 100%.

The analysis suggests that Labubu, like games, does not need to be "loved by everyone." Its business foundation lies in a large fan base with extremely high loyalty and repurchase rates. The nearly 50% repurchase rate of Pop Mart members is precisely the "moat" of its business model.

From this perspective, the valuation of Pop Mart does not seem outrageous. The key is whether Labubu can become a timeless classic IP like Super Mario, rather than a fleeting internet celebrity product.