• 2Q26 revenue exceeded expectations slightly due to stronger-than-expected Shopee and Monee growth, while PATMI was in line as elevated sales & marketing expense and provision for credit losses (+52%, +65% YoY, respectively) weighed on earnings.  1H26 revenue/PATMI was at 52%/48% of our FY26e estimates. 
• Revenue delivered strong growth of 48% YoY, supported by strong Shopee growth (+49% YoY) and rapid loan-book expansion at Monee (+59% YoY).  Garena shows a slight slowdown, with books +16% YoY.
• We maintain our BUY recommendation, with an unchanged target price of US$170.00. We increase our FY26e revenue assumptions by 3% to account for stronger-than-expected growth at Shopee and Monee. We also increase our sales and marketing expense and the provision for credit losses by 5% and 3%, respectively, to account for elevated investment and credit expansion. Terminal growth and WACC assumptions remain unchanged. Both fulfilment and Monee are still in the early stages of penetration; we believe the significant runway across both businesses should support continued margin improvement and greater earnings scalability over time.

Overview BLOKS is a leader in China’s assembly character toys market. The company holds over 500 patents, possesses original IP capabilities, and has non-exclusive licenses for approximately 50 well-known IPs. Its product positioning is “high quality at a reasonable price.” Leveraging its product strength and supply chain advantages, BLOKS maintains cost competitiveness while continuously expanding its product categories. The company has established a multi-channel sales network, and since 2022, has primarily focused on offline channels centered on distributors. According to...
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Overview POP MART is primarily engaged in the design and development of trendy toys. It operates a comprehensive platform covering the entire industry chain of intellectual property (IP) for trendy toys, with businesses including IP incubation and operation, trendy toys and retail, theme park and experiences, and digital entertainment. The company’s products include blind boxes, figurines, ball-jointed dolls (BJD), MEGA, plush toys, and derivatives, among others. Its self-developed products primarily feature artist-owned IPs such as THE MONSTERS, MOLLY, SKULLPANDA, and...
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