Miniso Group Holding Ltd. has hired JPMorgan Chase & Co. and UBS Group AG to assist with the initial public offering (IPO) of its Top Toy unit in Hong Kong, according to sources familiar with the situation.

The company is also seeking investments for Top Toy from potential backers, including sovereign wealth funds, ahead of the listing.

The Guangzhou-based retailer launched Top Toy in late 2020 with nine stores in five Chinese cities.

By March 2025, the brand had expanded to 280 locations and commenced international operations, according to Miniso’s latest quarterly report.

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🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Competing business models define China’s booming collectible toy market

Top Toy and Pop Mart represent fundamentally different approaches to the same explosive market opportunity, with Top Toy deliberately choosing licensed IP over original character development.

While Pop Mart achieved its $42 billion valuation through self-developed characters like Labubu, which alone generated RMB 3 billion in 2024, Top Toy’s founder Sun Yuanwen explicitly noted that the market for original IPs is saturated1.

Instead, Top Toy has pursued partnerships with established franchises like Disney and Sanrio to create derivative collectibles, reaching profitability in its first full year with RMB 983.5 million in sales and 50% year-over-year growth2.

This strategic divergence offers investors distinct risk profiles: Pop Mart’s higher-margin original IP business (71.3% gross margins in overseas markets) versus Top Toy’s potentially more stable but lower-margin licensed character approach3.

The contrast highlights how China’s collectible toy sector is maturing into specialized business models targeting different segments of a market projected to reach RMB 110.1 billion ($15.2 billion) by 20264.

2️⃣ China’s collectible toy boom represents a demographic and consumption shift

The extraordinary market performance of Pop Mart (340% rise last year) and Miniso’s decision to spin off Top Toy reflect fundamental changes in who buys toys and why.

Gen Z and young urban women now account for over 60% of China’s collectible toy market, which is growing at an exceptional 35% annually and projected to reach RMB 150 billion by 20251.

This growth is driven by the “kidult” phenomenon, with toys increasingly targeting teenagers and adults rather than just children, as evidenced by industry events like Toy & Hobby China introducing dedicated “Trendy Toy Zone” spaces specifically for this demographic4.

The “blind box” strategy employed by both Pop Mart and Miniso has transformed collecting into a social activity, with consumers participating in unboxing and trading communities that create sustained engagement and repeat purchases5.

Limited-edition releases drive consumer excitement and have spawned a speculative resale market that enhances perceived value, with rare items commanding significant markups that further fuel primary market demand1.

3️⃣ International expansion brings opportunities and tariff challenges

As Top Toy prepares for its IPO, its international expansion strategy faces a complex trade environment that has forced rapid supply chain adaptation across the industry.

Rising U.S. tariffs, which have reached 145% on some Chinese goods, are directly impacting Pop Mart and Miniso’s global strategies despite strong overseas demand, with Pop Mart’s North American revenue surging 556.9% year-on-year to reach 720 million yuan (approximately $99 million)3.

Both companies have responded by diversifying manufacturing: Pop Mart has shifted 10% of production to Vietnam while Miniso has increased local sourcing in the U.S. to nearly 40%3.

Top Toy has already opened five stores in Southeast Asia and aims to increase international sales to over 50% of its total business, part of an ambitious plan to establish over 1,000 stores in key commercial districts globally6.

This international focus is particularly significant for Top Toy’s IPO prospects as it demonstrates potential growth beyond China’s increasingly competitive domestic market, where Miniso’s core retail segment has struggled with declining same-store sales despite Top Toy’s success2.

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