Pop Mart shares surge as traders cheer first share buyback since 2024

POP MART International Group shares soared the most in five months after the Chinese toymaker’s first share buyback since 2024 boosted investor confidence. 

The Hong Kong-listed stock jumped as much as 10 per cent during early trading Tuesday, the most since Aug 20. The company announced in a filing that it bought back 1.4 million shares on Jan 19 for HK$251 million (S$41.1 million). Its last buyback was in February 2024, data compiled by Bloomberg show.

The buyback “could get more investor attention, especially from those who have been waiting for stock catalysts,” Morgan Stanley analysts including Dustin Wei wrote in a note. The company likely has “abundant financial resources for more shareholder returns,” though it didn’t set a target size or timetable for future repurchases.

The stock is down more than 40 per cent from its August peak as investors grow skeptical about the firm’s ability to sustain its breakneck sales growth amid signs of waning demand for Labubu toys.

Tuesday’s sharp rally could be painful for short sellers who had ramped up bearish bets against the stock. Its short interest was at 7 per cent of free float on Friday, up from 0.2 per cent in early September, S&P Global data shows. BLOOMBERG