In-Depth Analysis of Suplay: Plunge in Self-Developed IP Revenue Share and Research on Licensing Risk Pricing

Based on the collected information, I will provide you with an in-depth analysis report on Suplay.

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Founded in 2019, Suplay is a trend culture enterprise focusing on IP collectibles and consumer products, with its flagship brand “Kakawow” under its umbrella. Huang Wanjun, the company’s founder and CEO, holds 72.86% of Suplay’s shares through his affiliated companies, making him the controlling shareholder. In the 2021 Series A+ financing, renowned game company miHoYo invested USD 8 million in Suplay and currently holds 11.86% of the shares, making it the company’s largest external shareholder [1][2].

Suplay adopts a dual-drive business model of “IP licensing + self-developed IPs”, mainly engaging in the development and sales of collectible non-competitive trading cards. According to Frost & Sullivan, Suplay ranked first in GMV in the Chinese market for collectible non-competitive trading cards, a niche segment of the card industry, in 2024 [3].

Suplay’s product lines are mainly divided into two segments:

: Positioned in the high-end market, it focuses on the collectible segment with a single card issue price exceeding RMB 10, adopts a limited release strategy, and combines artistic texture and collection value. The value of these cards is anchored by international third-party authentication institutions (such as PSA, CGC) and users’ willingness to submit cards for evaluation. Cards with high submission rates have higher collection attributes [1].

: Covers trend toys and IP derivatives, with relatively low unit prices, targeting a broader consumer group. In 2023 and 2024, consumer products accounted for 67.1% and 58.2% of total revenue, respectively [2].

From the perspective of the changing trend of business proportions, the share of the collectibles business has continued to rise, from approximately 33% in 2023 to over 70% in the first three quarters of 2025, driving the company’s overall gross profit margin up from 41.7% to 54.5% [3].

Financial Indicator	2023	2024	First Three Quarters of 2025
Revenue (RMB 100 million)	1.46	2.81	2.83
YoY Revenue Growth Rate	-	92.5%	~40%
Net Profit (RMB 10,000)	294.9	4,911.5	3,707.4
Adjusted Net Profit (RMB 10,000)	1,597.4	6,481.5	8,642.3
Net Profit Margin	2.0%	17.5%	13.1%
Adjusted Net Profit Margin	10.9%	23.1%	30.5%
Gross Profit Margin	41.7%	45.8%	54.5%

The data shows that Suplay’s profitability has shown a significant improvement trend during the reporting period. Its adjusted net profit margin increased from 10.9% in 2023 to 30.5% in the first three quarters of 2025, and its gross profit margin also rose from 41.7% to 54.5% [2][3]. This improvement is mainly attributed to: 1) The product structure tilts towards the high-margin collectibles business; 2) The scale effect brought by sales volume growth dilutes unit production costs; 3) Improved operational efficiency and controlled marketing expenses.

However, the revenue growth rate slowed to approximately 40% in the first three quarters of 2025, a significant decline from 92.5% in 2024, indicating that the company is entering a steady development phase after high-speed growth [3].

Despite strong performance, Suplay faces certain inventory risks. In the first three quarters of 2025, the company wrote off over RMB 36 million in inventory with a shelf life of more than one year, equivalent to a one-time write-down of over half of its inventory [3]. This reflects the vulnerability of the “price preservation and volume control” model during a market downturn.

In terms of cash flow, the company’s cooperation with KOLs/KOCs mostly adopts a product barter model, which does not require large cash investments, so the marketing promotion expense accounts for only about 1% of revenue [3]. This asset-light operation model helps control costs, but it also limits the intensity and scope of brand promotion.

Suplay’s self-developed IP business has shown a continuous shrinking trend, which is the most noteworthy risk signal at present:

Time Period	Self-Developed IP Revenue Share	Licensed IP Revenue Share
2023	40.6%	54.2%
2024	14.4%	85.1%
First Three Quarters of 2025	4.1%	95.0%

Self-developed IP revenue fell from approximately RMB 60 million in 2023 to approximately RMB 40 million in 2024, and further dropped to only RMB 11.72 million in the first three quarters of 2025 [1][2]. As of September 30, 2025, the company mainly owns three self-developed IPs: Rabbit KIKI, Uncle OHO, and Water Wave Egg, all of which are trend toy IPs targeting young consumers.

The sharp decline in the share of self-developed IPs reflects the following issues:

: The company has failed to effectively incubate hit IPs with long-term viability. Compared with Kayou’s self-developed IP “Kayou Three Kingdoms” launched in April 2023, which accumulated a GMV of RMB 294 million by the end of 2024, Suplay’s self-developed IP commercialization capability is significantly weaker [4].

: The development of self-developed IPs requires full-chain capabilities from market research, product design, marketing promotion to extended operation. As a latecomer, Suplay has insufficient accumulation in IP incubation and long-term operation [3].

In sharp contrast to the decline of self-developed IPs, the share of licensed IP revenue has risen from 54.2% in 2023 to 95% in the first three quarters of 2025 [1][2]. This high dependence on licensed IPs brings multiple risks:

: The total revenue contributed by the top five licensed IPs accounted for approximately 47.8%, 61.5%, and 77.7% of the company’s total revenue in the corresponding periods, respectively, with the concentration continuing to rise [1]. The revenue contribution share of the largest licensed IP also increased from 17.8% in 2024 to 32.3% in the first three quarters of 2025 [3].

: The prospectus discloses that the license for the core IP that contributed the most revenue to Suplay during the track record period has expired. The company is conducting friendly negotiations with the licensor to explore potential cooperation under broader product categories and more favorable commercial terms, but cannot guarantee the final negotiation result [3].

: In 2024, the IP licensing fee included in Suplay’s sales cost accounted for more than 10% of total revenue, while Kayou, which signed nearly 70 IPs in the same period, had a ratio of only 7.6% [3]. This indicates that Suplay has weak bargaining power in IP licensing negotiations.

Suplay’s licensed IP cooperation has the following characteristics:

: The company has reached licensing arrangements with 22 IP licensors, but the vast majority are non-exclusive. The licensor can grant the same IP rights to multiple companies (including direct competitors) at the same time, leading to multiple market participants offering products based on the same or substantially similar IPs, resulting in market saturation and reduced product differentiation [1].

: Although the company has a small number of exclusive licenses, such as Hajime Sorayama and the Chinese National Winter Sports Team, most top-tier IPs (such as Disney, Marvel, Harry Potter) are non-exclusive collaborations [3].

: IP licensing agreements are usually for one to three years, non-renewable automatically, with high uncertainty in renewal [1].

In the card industry, there are significant differences in market positioning between Suplay and Kayou:

Dimension	Suplay (Kakawow)	Kayou
Card Type	Collectible Non-Competitive Trading Cards	Collectible Trading Cards (Mainly Competitive)
Single Card Issue Price	>10 RMB	~1.7 RMB (Average per Pack)
Target Customer Group	Adults (>99% of consumers are over 18 years old)	Teenagers and Children
2024 Revenue	281 million RMB	10.057 billion RMB
2024 Growth Rate	92.5%	~270%
Gross Profit Margin	45.8% (Overall), 62.6% (Collectible Cards)	67.3% (Overall), 71.3% (Cards)

In terms of scale, there is a huge gap between Suplay and industry leader Kayou, with Suplay’s 2024 revenue being less than one-thirtieth of Kayou’s [2][3]. Looking at 2024, when My Little Pony and live card unboxing ignited the industry, Hitcard’s revenue soared 6 times year-on-year, Kayou’s revenue increased 2.7 times to exceed RMB 10 billion, while Suplay, with a growth rate of 90% in the same period, did not perform prominently in the industry [3].

:

• Niche market leadership
  : Suplay ranks first in GMV in the niche market of collectible non-competitive trading cards, with first-mover advantage [1]
• Overseas market expansion capability
  : The company’s transaction volume on eBay and the domestic Card Tao platform ranks first among all Chinese card brands, with a certain international foundation [3]
• Advantage in cooperation with rating institutions
  : It has established strategic cooperation with globally renowned rating institutions such as PSA and CGC, and is the brand with the highest proportion of Chinese consumers voluntarily submitting cards for evaluation to international rating institutions [3]

:

• Scale disadvantage
  : The revenue scale is much smaller than that of competitors, making it difficult to obtain cost advantages brought by scale effects
• Weak bargaining power in IP licensing
  : The licensing fee rate is higher than the industry average (10% vs 7.6%)
• Insufficient channel coverage
  : It has long focused on the collectible card field, with relatively weak layout and operation experience in offline mature channels [3]
• Limited brand influence
  : When strong copyright holders choose cooperation partners, leading players have more advantages. For example, when Pop Mart chose a collectible card issuer for its LABUBU, it selected Topps, an international brand with greater global influence [3]

Suplay has obvious shortcomings in self-developed IP development capabilities:

: The company currently only has three self-developed IPs: Rabbit KIKI, Uncle OHO, and Water Wave Egg, with a low degree of commercialization. Their total revenue in the first three quarters of 2025 is only RMB 11.72 million, accounting for 4.1% [1][2].

: Successful content creation capability lies not only in the initial development of IPs, but also in continuous operation and extension. Suplay’s self-developed IPs lack long-term life cycle planning and market promotion [4].

: Effective content synergy and traffic mutual guidance have not been formed between self-developed IPs and licensed IPs, restricting the healthy development of the overall IP ecosystem.

Under the model of high dependence on licensed IPs, Suplay’s content differentiation is mainly reflected in:

: The company enhances the artistic value and collection value of products by cooperating with renowned artists (such as Hajime Sorayama) and designing unique card crafts (such as hot stamping, embossing, etc.) [1].

: It creates scarcity through limited releases, pre-sale lotteries, etc., to support product premium.

: It has established a third-party certification system for card value through cooperation with international rating institutions such as PSA and CGC [3].

However, these differentiation methods have relatively low thresholds and are easy to be imitated by competitors. In the long run, the core competitive barrier still needs to be built on unique IP assets and content creation capabilities.

Company	Self-Developed IPs	Licensed IPs	Characteristics of IP Strategy
Pop Mart	MOLLY, SKULLPANDA, etc.	Few	Centered on self-developed IPs, building a trend toy empire
Kayou	Kayou Three Kingdoms (self-developed)	Ultraman, My Little Pony, etc. (over 70)	Dual-drive of self-developed + licensed IPs
Suplay	KIKI, OHO, Water Wave Egg	22 Partners	Heavily dependent on licensed IPs

Compared with Pop Mart and Kayou, Suplay has obvious gaps in self-developed IP reserves and content creation capabilities, which is the core shortboard restricting the company’s long-term development [4].

The licensing renewal risk faced by Suplay is the biggest operational risk at present:

: The prospectus clearly discloses that the license for the core IP that contributed the most revenue to Suplay during the track record period has expired [3]. Although the company stated that it is conducting friendly negotiations with the licensor, it cannot guarantee the negotiation result.

: Licensing agreements are usually for one to three years and cannot be renewed automatically, with uncertainty in renegotiating terms for each renewal [1].

: For popular IPs, licensors usually take the initiative in renewal negotiations, and may increase the licensing fee rate or reduce the licensing scope.

: From 47.8% in 2023 to 77.7% in the first three quarters of 2025, indicating that the company’s dependence on top-tier licensed IPs is deepening [1].

: After dropping from 28.4% in 2023 to 17.8% in 2024, it rebounded to 32.3% in the first three quarters of 2025, reflecting the fragility of the revenue structure [1][3].

: The market performance of licensed IPs is affected by many factors, including the IP’s own life cycle, popular content updates, competition impact, etc. A decline in IP popularity will directly affect the sales of related products.

: Most licensed IPs are non-exclusive, and the licensor can grant the same IP rights to multiple companies at the same time, leading to market saturation and reduced product differentiation [1]. For example, there are nearly 10 card companies that have obtained Disney licenses today [3].

: IP licensors may reserve the right to produce and distribute their own products that directly compete with Suplay’s products, forming direct competition [1].

: As industry competition intensifies, the licensing costs of high-quality IPs may continue to rise, further eroding profit margins.

Based on prospectus information and industry analysis, the following qualitative assessment of Suplay’s licensing risks can be made:

Risk Type	Risk Level	Impact Degree	Probability of Occurrence
Core IP Renewal Failure	High	Extremely High	Medium
Rising Licensing Costs	Medium-High	Medium-High	High
Decline in Licensed IP Popularity	Medium	Medium	Medium-High
Intensified Competition from Non-Exclusive Licenses	Medium	Medium	High
Direct Competition from Licensors	Low-Medium	Medium	Medium-Low

Overall, the licensing risks faced by Suplay are at a relatively high level, especially the uncertainty of core IP renewal, which poses a major threat to the company’s operations.

For card companies like Suplay that are highly dependent on licensed IPs, traditional valuation methods have certain limitations:

: Based on the annualized net profit of approximately RMB 49.43 million in the first three quarters of 2025, referring to peer companies in the same industry (such as Pop Mart’s PE of about 40x, Yaoji Technology’s PE of about 15x), Suplay’s PE valuation range is about RMB 700 million to 2 billion [4]. However, PE valuation fails to fully reflect IP licensing risks and the value of self-developed IPs.

: Based on the 2024 revenue of RMB 281 million, referring to the PS valuation of peer companies (Pop Mart’s PS of about 8x, Kayou’s PS of about 3x), Suplay’s PS valuation range is about RMB 800 million to 2.2 billion. PS valuation takes into account revenue scale, but also fails to effectively quantify IP risks.

: The DCF model requires assumptions about future IP licensing renewals, revenue growth, profit margins, etc. The uncertainty of core IP renewal increases the difficulty of valuation. It is necessary to fully consider the impact of cash flow in the scenario of licensing failure in the model.

Considering Suplay’s special business model, it is recommended to adopt a risk-adjusted multi-scenario valuation model:

:

• Optimistic scenario (30% probability)
  : Core IP is successfully renewed, self-developed IP share increases to 15%, 2026 revenue grows by 50%, adjusted net profit margin remains at 28%
• Neutral scenario (50% probability)
  : Core IP is renewed with slightly unfavorable terms, self-developed IP share remains at around 5%, 2026 revenue grows by 30%, adjusted net profit margin drops to 25%
• Pessimistic scenario (20% probability)
  : Core IP renewal fails, revenue drops sharply, self-developed IPs fail to fill the gap, 2026 revenue decreases by 20%, adjusted net profit margin drops to 20%

:

Based on the above scenarios and DCF model (assuming a perpetual growth rate of 2%, WACC of 12%), the reasonable valuation range of Suplay can be obtained:

Scenario	Valuation (RMB 100 million)	Valuation Basis
Optimistic Scenario	18-22	Successful core IP renewal + scale expansion
Neutral Scenario	12-15	Core IP renewed with unfavorable terms
Pessimistic Scenario	6-9	Core IP renewal failure
Weighted Average	12-16	Considering scenario probabilities

In valuation, it is necessary to separately evaluate Suplay’s IP assets:

: Although the current revenue contribution is only 4