In-Depth Analysis Report on the Sharp Decline of Suplay's Self-Developed IP Revenue Share

Based on collected prospectus and media report materials, I will provide a systematic in-depth analysis of the sharp decline in Suplay’s self-developed IP revenue share.

In-Depth Analysis Report on the Sharp Decline of Suplay’s Self-Developed IP Revenue Share

1. Overview of Core Data

Indicator	2023	2024	First Three Quarters of 2025	Trend
Self-Developed IP Revenue Share	40.6%	14.4%	4.1%	Sharp Decline
Licensed IP Revenue Share	54.2%	85.1%	95.0%	Significant Growth
Total Revenue Scale	RMB 146 million	RMB 281 million	RMB 283 million	Sustained Growth
Net Profit	RMB 2.949 million	RMB 49.115 million	RMB 37.074 million	Profitability Improvement

Key Observations

: Self-developed IP revenue share plummeted from 40.6% to 4.1%, a drop of as much as

36.5 percentage points

, while licensed IP revenue share surged from 54.2% to 95% during the same period [1][2].

2. Analysis of Causes for the Sharp Decline in Self-Developed IP Revenue Share

1. Shift in Strategic Focus – “Scale-First” Strategy

Suplay clearly stated in its prospectus that “expanding scale remains the core task” at this stage. From a business logic perspective, top-tier licensed IP has the following advantages:

High Brand Recognition
: Global top-tier IPs such as Disney, Marvel, and Harry Potter have built-in traffic, reducing customer acquisition costs
Strong Market Acceptance
: Consumers have a higher willingness to pay for mature IPs, which is conducive to premium pricing strategies
Significant Scale Effects
: Licensed IP products can spread fixed costs by increasing sales volume

In the first three quarters of 2025, Suplay’s

gross profit margin has increased to 54.5%

, up 12.8 percentage points from 41.7% in 2023, which is mainly due to

significant sales growth spreading unit production costs

[3].

2. Insufficient Cultivation of Self-Developed IPs

As of September 30, 2025, Suplay has only

3 self-developed IPs

: Rabbit KIKI, Uncle OHO, and Water Wave Egg. In contrast, its competitor Kayou has signed nearly 70 IPs, forming a stark contrast [4].

Continuous Decline in Absolute Revenue from Self-Developed IPs

2023: Approximately RMB 60 million
2024: Approximately RMB 40 million
First Three Quarters of 2025: Only RMB 11.72 million

This reflects insufficient investment or poor results in Suplay’s R&D, operation, and promotion of self-developed IPs.

3. The “Sweet Trap” of Licensed IPs

Top-tier licensed IPs bring significant short-term benefits, but also lead to severe dependency issues:

Skyrocketing Revenue Concentration
: Revenue contribution from the top five licensed IPs increased from 47.8% in 2023 to 77.7% in the first three quarters of 2025
Dependency on the Largest Licensed IP
: Revenue contribution from the single largest licensed IP increased from 28.4% to 32.3%
Risks from Licensing Agreements
: The prospectus discloses that the license for the core IP contributing the most revenue to Suplay has
expired
, and renewal negotiations are still ongoing [1][2]

3. Has Brand Value Weakened? – Multi-Dimensional Assessment

✅ Arguments Against “Brand Value Weakening”

Dimension	Analysis	Conclusion
Market Share	Based on 2024 GMV, Suplay ranks first in China’s collectible non-competitive card market, exceeding the combined total of the second and third places	✅ Strengthened
Profitability	Net profit increased from RMB 2.949 million in 2023 to RMB 49.115 million in 2024, a growth of over 15 times	✅ Strengthened
Gross Profit Margin	Increased from 41.7% to 54.5%, with significant improvement in operational efficiency	✅ Strengthened
Brand Positioning	“Kakawow” maintains a stable leading position in the high-end collectible card segment	✅ Stable
Capital Recognition	Received investments from well-known institutions such as miHoYo (11.86% shareholding) and Gigabit	✅ Strengthened

⚠️ Concerns Over “Structural Weakening” of Brand Value

However, when assessed from the perspective of

long-term brand competitiveness

, the situation is not optimistic:

Loss of Autonomy
:
- 95% of revenue depends on external licensed IPs, resulting in loss of pricing power and product differentiation capabilities
- Under non-exclusive licensing models, multiple competitors can use the same IP, leading to severe product homogenization
Lack of Moat
:
- Self-developed IP revenue accounts for only 4.1%, meaning the company lacks “irreplaceable” core assets
- If the renewal of major licensed IPs fails or terms deteriorate, the company will face significant operational risks
Impaired Valuation Logic
:
- Business models dependent on licensed IPs struggle to obtain “brand premium” valuations
- Investors value the long-term value creation capability of self-developed IPs more

4. Risk Assessment and Investment Implications

🔴 High-Risk Items

Risk Type	Specific Description	Risk Level
License Renewal Risk	Core licensed IP has expired, with significant uncertainty regarding renewal results	Extremely High
Concentration Risk	The top five licensed IPs contribute 77.7% of revenue, so fluctuations in a single IP have a huge impact	High
Inventory Impairment Risk	Inventory write-downs amounted to RMB 36.3 million in the first three quarters of 2025, equivalent to more than half of inventory	High
Increased Competition Risk	Non-exclusive licensing leads to multiple competitors offering homogeneous products	Medium-High

📊 Key Financial Indicators

Indicator	Value	Industry Comparison
Gross Profit Margin	54.5% (First Three Quarters of 2025)	Lower than Kayou’s 67.3%
License Fee Ratio	>10% of revenue	Higher than Kayou’s 7.6%
Inventory Turnover Days	30 days	Upward trend
Trade Receivables	RMB 34.1 million	Continuing to rise

5. Conclusions and Outlook

Core Conclusion

: The sharp decline in self-developed IP revenue share is

not direct evidence of brand value weakening in the short term

, but

poses major structural risks in the long run

Short-Term Perspective

: Suplay has doubled its revenue scale and significantly improved profitability by focusing on top-tier licensed IPs, establishing a leading position in the collectible card niche market. This is a pragmatic “scale-first” strategy.

Long-Term Perspective

: Over-reliance on external licensed IPs has caused the company to lose its core competitive moat. If licensing agreements change or the popularity of top-tier IPs fades, the company will face severe challenges. The 4.1% share of self-developed IPs means the company has seriously deviated from the path of IP independence.

Strategic Recommendations

: If Suplay successfully completes its IPO, the raised funds should be prioritized for:

Increasing investment in R&D and operation of self-developed IPs
Securing more exclusive licensed IP collaborations
Expanding into high-growth categories such as TCG cards
Building a global IP collaboration network

References

[1] National Business Daily - “Domestic Collectible Card Leader Suplay Files for Hong Kong IPO: Valuation Surges 20x After 5 Rounds of Financing” (https://www.nbd.com.cn/articles/2026-01-04/4205703.html)

[2] Eastmoney - “90% of Revenue Depends on Third-Party IPs! How Long Can Suplay’s Card Business Thrive?” (http://finance.eastmoney.com/a/202601043607824245.html)

[3] 21st Century Business Herald - “Self-Proclaimed “Super Adult Card Enthusiast” Races for Hong Kong IPO, miHoYo Holds 11.86% Stake” (https://www.21jingji.com/article/20260106/herald/1118d13b3a3183687305947858a82c17.html)

[4] Wall Street CN - “Collectible Card Player Suplay Seeks Hong Kong IPO: How to Expand a “Price Preservation & Volume Control” Business?” (https://wallstreetcn.com/articles/3762619)

In-Depth Analysis Report on the Sharp Decline of Suplay's Self-Developed IP Revenue Share

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