Financial analysis and revenue forecasts of POP MART

Abstract

POP Mart experienced rapid financial development and made significant success in IP products over the past five years. Even under the impact of the COVID-19 in 2020, the revenue of POP Mart is still in a profitable state although it has a declining trend. However, in the face of the current fast-rising revenue, POP Mart's business model has also revealed some problems. There is uncertainty about future developments. This individual study using the financial statement from 2017 to 2020 of POP Mart annual prospectus to estimate the debt-paying ability, operating ability, and profitability using the financial ratio analysis. And through a bottom-up split forecast based on POP Mart's main sales channels for the company's new store openings and same-store growth rate; and a top-down forecast for cross-validation with the trendy toy market space and the outlook of the market share. The results under the financial ratio analysis and future revenue forecasts indicate that POP Mart's revenues are continuing to grow steadily between 2017-2020 and will continue to rise in 2020 and 2021 as well, although the rate of increase will slow down, there is still an opportunity to grow further.