Temasek bets: Pop Mart's biggest competitor is going public

When opening a blind box is no longer a surprise, but the capital playbook, the real contest in the collectibles (trendy toy) industry is only just beginning.

On March 31, 2026, Dah Chao Toys International Group Co., Ltd. (TOP TOY), after a half-year gap, once again filed its prospectus with the Hong Kong Stock Exchange’s Main Board, with JPMorgan Chase and UBS Group serving as joint sponsors. This is its second attempt to push for a listing after its first submission for review became ineffective in September 2025, and it also puts the “one super one strong” landscape of China’s collectibles market squarely on the stage—TOP TOY, as a collectibles collection brand personally incubated by Miniso (Miniso), has been viewed from the day it was born as the most direct and most threatening competitor to Pop Mart.

One is the industry overlord that has deepened its focus on proprietary IP and holds breakout products such as Molly and Labubu; the other is the pursuer backed by a retail giant, rapidly scaling up through a collection-store model, with three-year cumulative GMV growth of over 50%.

In this article, we will answer the following three questions:

1、Revenue doubles, but net profit is cut in half—why does TOP TOY’s profitability logic become unbalanced?

2、As both leading brands in collectibles, where exactly do TOP TOY and Pop Mart differ in their financials and business models?

3、With a high dependence on Miniso and external licensed IP, can TOP TOY support the valuation for an independent listing?

01

From Miniso incubation to a sprint for Hong Kong shares: five years to carve out the second pillar in collectibles

In 2020, Pop Mart listed on the Hong Kong Stock Exchange, and the blind-box model ignited the collectibles track. In December of the same year, Miniso founder Ye Guofu opened the first TOP TOY store in Guangzhou, formally moving into this game of “emotion-driven consumption.”

Over the next five years, TOP TOY rode the explosive growth window of China’s collectibles industry. According to data from Frost & Sullivan, the domestic collectibles market size surged from RMB 24.9 billion in 2020 to RMB 87.5 billion in 2025, with a compound annual growth rate of 28.6%, and is expected to exceed RMB 331 billion by 2030.

Different from Pop Mart’s early strategy of focusing on a single IP, TOP TOY established a position as a collectibles collection store from the start. Relying on Miniso’s mature supply chain, offline site-selection capabilities, and franchising channels, it launched a rapid expansion. By end-2021, the number of stores exceeded 100; in 2024, it began its overseas layout, entering markets such as Thailand, Malaysia, and Indonesia. By end-2025, it had 334 stores worldwide, with more than 12 million registered members.

With the “full-category coverage + multi-IP collection + rapid store opening” model, TOP TOY quickly moved into the industry’s front ranks. In 2025, its GMV in Mainland China reached RMB 4.2 billion, ranking second in China’s collectibles industry and first among collectibles collection brands, with a market share of 4.8%. From 2023 to 2025, GMV grew at a compound annual growth rate of over 50%, making it the leading brand with the fastest growth in the industry.

2025 became a key turning point for TOP TOY’s capitalization. In July, it completed a Series A round raising USD 59.4 million, with top-tier institutions such as Temasek and Rayon Capital joining in; its post-investment valuation was USD 1.3 billion. In September, it made its first submission to the Hong Kong Stock Exchange; after it became ineffective, on March 31, 2026 it submitted its prospectus again, aiming to become the “No. 1 collectibles collection brand in Hong Kong shares.” It also became the third listed-company candidate entity controlled by Ye Guofu after Miniso and Yonghui Superstores (601933).

02

Increase in revenue without increase in profit: the financial truth behind high growth

In 2025, TOP TOY delivered a seemingly contradictory set of results: revenue surged 87.9% to RMB 3.59B, but net profit fell sharply from RMB 294 million to RMB 101 million, a drop of 65.6%. Revenue doubled, while profit was cut in half—this is not deteriorating operations, but an accounting “surgery” before listing.

In the past three years, TOP TOY achieved leapfrog growth in revenue, but profit performance clearly diverged, becoming the core focus of market attention. The data shows that from 2023 to 2025, the company’s total revenue grew from RMB 1.46B to RMB 3.59B, with a compound growth rate of over 56%; in 2025, the year-on-year growth rate was as high as 87.9%. Gross profit grew in tandem, rising from RMB 459 million to RMB 1.15B; the gross margin remained stable in the 31.4%-32.7% range, and the overall scale of profitability increased steadily as revenue expanded.

Source: TOP TOY prospectus

But net profit told the opposite story: net profit was RMB 212 million in 2023, increased to RMB 294 million in 2024, but then fell sharply to RMB 101 million in 2025, with a year-on-year plunge of 65.6%. Net profit margin dropped from 15.4% to 2.8%, showing a typical “increase in revenue without increase in profit” pattern.

Source: TOP TOY prospectus

As to the reason, the decline in profit is not due to losses in the core business, but due to non-cash items and listing-related expenses: in 2025, the change in the carrying value of preferred share redemption liabilities was RMB 158 million, combined with large non-cash expenses such as share-based payments and intermediary fees related to the listing, totaling an impact on profit of nearly RMB 390 million. After excluding one-off factors, the adjusted net profit was RMB 522 million, and the profitability of the core business remains solid.

Source: TOP TOY prospectus

In terms of financial structure, as the scale expands, asset occupation continues to rise: accounts receivable increased from RMB 229 million in 2023 to RMB 484 million in 2025; inventory surged from RMB 128 million to RMB 461 million, mainly due to increased store expansion and higher inventory preparation demand; allowances for credit losses on trade and other receivables were RMB 10.48 million, indicating rising pressure from asset impairment.

Source: TOP TOY prospectus

Customer concentration risk also deserves attention: over the past three years, the revenue share contributed by the top five customers declined from 76.5% to 59.5%. Among them, Miniso contributed a revenue share that fell from 53.5% to 46.6%. Dependency gradually decreased, but it remains at a relatively high level; related-party transactions and channel independence have become key points in the listing review.

Source: TOP TOY prospectus

03

Model showdown: IP brands vs collection retail— the gap isn’t in scale, it’s in logic

Competition in the collectibles track essentially comes down to a battle between an IP-driven model and a collection retail model. Although TOP TOY and Pop Mart both operate in the collectibles arena, their underlying business models, profit structures, and core moats are completely different—this is also why their financial data diverges so greatly.

In terms of scale, Pop Mart leads by a wide margin: in 2025, revenue was RMB 37.12 billion, up 184.7%, which is more than 10 times TOP TOY; its adjusted net profit was RMB 13.08 billion, which is 25 times TOP TOY’s adjusted profit— the magnitude difference is significant.

Data sources: Pop Mart financial reports, TOP TOY prospectus, etc.

The gap in profitability is even more stark: Pop Mart’s gross margin in 2025 was as high as 72.1%, up 5.3 percentage points from 2024, while TOP TOY’s gross margin was only 32.1%, less than half of the former. The core difference comes from the IP structure. Pop Mart is a pure IP brand operator: in 2025, the share of revenue from its own IP exceeded 99%, meaning it does not need to pay licensing fees and has pricing power. TOP TOY, by contrast, is mainly based on the collection-store model: in 2025, the share of revenue from its own IP was only 5.7%; licensed IP accounted for 51.0%; third-party IP accounted for 43.3%. It must continuously pay high licensing fees, directly compressing gross margin space.

Data sources: Pop Mart financial reports, TOP TOY prospectus, etc.

Channels and operational logic also differ greatly: Pop Mart focuses primarily on direct operations and efficient online operations, with a member repurchase rate of 55.7% and very strong user stickiness. TOP TOY is centered on the franchise + distributor model: in 2025, the share of offline distributor revenue was 57.0%, franchisees accounted for 18.9%, and direct retail only accounted for 12.4%. It emphasizes scale expansion rather than single-store efficiency.

Data sources: Pop Mart financial reports, TOP TOY prospectus, etc.

Simply put, Pop Mart earns money from IP premiums and brand moats, while TOP TOY earns money from channel turnover and supply-chain efficiency. Neither model is absolutely better, but in the valuation framework of the capital markets, the IP-driven model has more room for a premium.

04

Capital and equity: Miniso absolutely controls; top-tier capital adds support

TOP TOY’s path to capitalization is clear, and its equity structure is highly concentrated, presenting a pattern of “Miniso-led, management holding shares, and institutional backing.” On the financing side, the company only conducted one financing round: in July 2025, it raised USD 59.4 million in its A round, with a post-investment valuation of USD 1.3 billion (about HKD 10.2 billion). Investors include Temasek, Rayon Capital, and Chuangxiang Investment, among other first-tier institutions, providing endorsement for its listing.

Regarding the equity structure, before listing, Miniso held 86.9% of the shares, making it the controlling shareholder; founder and CEO Sun Yuanwen held 3.9%, CFO Yan Xiaojiao held 0.8%, the management platform TOP TOY MANAGEMENT held 3.7%, and total management shareholding was 8.4%; Temasek held 4.0% through its affiliated institutions, making it the largest external institutional shareholder. Other entities such as Rayceon Capital and the founder of Lingdong Chuangxiang, Xie Guohua, collectively held about 1.7%.

Source: TOP TOY prospectus

From a capital-logic perspective, TOP TOY is a key link in Miniso’s “mass consumption + emotion-driven consumption” ecosystem layout: leveraging Miniso’s supply chain, channels, and funding advantages to scale up quickly, achieving independent financing through a split listing, and reducing reliance on the group. At the same time, it directly confronts Pop Mart on the capital front, seizing the capital positioning of the second pillar in the collectibles track.

05

Opportunities and challenges under a trillion-yuan market

China’s collectibles industry is still in a phase of rapid growth. According to Frost & Sullivan data, the market size has jumped from RMB 24.9 billion in 2020 to RMB 87.5 billion in 2025. It is expected to exceed RMB 331 billion by 2030, and the compound annual growth rate is still projected to remain above 27%. The “one super one strong” landscape has taken initial shape, but concentration is still relatively low—the combined market share of the top five retailers is only 32.5%. This means TOP TOY still has ample room for growth.

After the second resubmission to the Hong Kong Stock Exchange, for TOP TOY to truly achieve an independent valuation, it must clear three hurdles:

First hurdle: earnings stability. After excluding one-off expenses before listing, the adjusted net profit of RMB 522 million proves the company’s ability to generate profits from its main business. But can it continue in the future? Can the gross margin break through the 30% threshold? This depends on whether self-developed IP can carry the weight.

Second hurdle: IP breakthroughs. Its share of revenue from proprietary IP is only 5.7%, while Pop Mart is already above 99%. TOP TOY needs to prove it is not just a “collectibles supermarket,” but also can incubate its own “Labubu.” The company plans to allocate a substantial portion of IPO proceeds to IP development, but whether results can match expectations still needs time for validation.

Third hurdle: independence. Miniso contributes nearly half of revenue—this is both a resource advantage and an obstacle to valuation. Reducing the proportion of related-party transactions, expanding independent distribution channels, and increasing the share of direct retail and online operations are tasks that must be completed after listing.

A box of collectibles—when opened, it’s emotion. A prospectus—when opened, it reveals business fundamentals. When TOP TOY stands at the gates of the Hong Kong Stock Exchange, it is not only challenging Pop Mart’s market position, but also the industry’s answer to profitability: can the collection-store model achieve an independent valuation? In a business that relies on licensed IP, can it grow into a towering tree? With a giant’s backing, can it go out and walk alone in the wilderness?

The story of collectibles continues, and the capital’s blind boxes have only just been opened.