Successfully rang the bell! Shaoxing boss went from losing money to becoming the world's top 3

Some people say that its success on the market is inseparable from the help of "Ultraman".

Its founder is from Shaoxing. He first founded an online game company and successfully pushed it to go public. He then cashed out 1 billion yuan and plunged into the category market. In 10 years, he went from "0" to "1" and became one of the top three in the world with the help of "Ultraman".

Small track half-year revenue exceeds 1 billion

On January 10, toy giant Bruco Group Limited ( hereinafter referred to as "Bruco") rang the bell and officially entered the capital market from the Hong Kong Stock Exchange.

The prospectus shows that from 2021 to the first half of 2024, BRUCK 's revenue reached 330 million yuan, 326 million yuan, 877 million yuan and 1.046 billion yuan respectively, with gross profit margins of 37.4%, 37.9%, 47.3% and 52.9% respectively .

Although both profit and gross profit margin were growing, its profitability at that time was very average, even "tragic" .

From 2021 to the first half of 2024, Bruco's annual losses reached 507 million yuan, 423 million yuan, 207 million yuan and 255 million yuan respectively . However , after adjustments , the losses increased from 356 million yuan and 225 million yuan to a profit of 72.882 million yuan and a profit of 292 million yuan.

*Note: Loss during the year directly reflects the total loss of an enterprise in a fiscal year ; adjusted loss refers to the loss amount obtained after adjusting certain non-recurring items.

In addition, it is mentioned at the beginning of the article that one of the contributors to Bruco’s listing was “Ultraman”. How do you explain this?

As a toy seller , BRUKU 's core products are role-playing toys and building block toys , especially role-playing toys.

In January 2022 , BRUCO launched building character toys , and its revenue grew rapidly.

In the first year of its launch, revenue from building character toys reached 118 million yuan . In the following year ( 2023), revenue from this category soared 553.5 % to 769 million yuan . In the first half of 2024 , it increased by 323.8% year-on-year to 1.023 billion yuan , accounting for 36.1%, 87.7% and 97.8% of the total revenue in the same period respectively .

At the same time, Bruco is not blindly producing puzzle role toys, but is linking with popular IPs in the children's market to create products based on the IP matrix.

According to the prospectus, BRUCO's IP matrix includes two self-owned IPs, BRUCO Variety from the children's educational game category and Heroes Unlimited from the Chinese traditional cultural theme; as well as 50 well-known IPs including Ultraman, Transformers, Naruto, etc.

Most importantly, in 2023 and the first half of 2024 , the revenue from Ultraman IP products accounted for 63.5% and 57.4% of Bruco's total revenue respectively . The large proportion of revenue has nothing to do with the adjusted profit turnaround, so many people in the industry joked that Bruco used Ultraman's light to pierce the IPO market.

Became the top 3 in the industry in just a few years

In 2014, BRUKO was founded (then named "Grape Technology"); two years later (2016) , it began to focus on the design, development and sales of building toys .

Although it has been in the market for less than ten years, BRUCK has already become a leader in the industry and one of the fastest-growing large-scale toy companies . It is the largest building role-playing toy company in China and the third largest in the world , and is known as the "Chinese version of Lego."

According to Frost & Sullivan, in terms of GMV, its market share in China's role-playing toy market and China's building toy market will reach 30.3% and 7.4% respectively in 2023. In the same year , Bruco achieved a GMV of about 1.8 billion yuan, a year-on-year increase of more than 170%.

The products occupy a huge share of the Chinese industry market, and BRUKO is also seeking new incremental markets, such as going overseas.

The prospectus mentioned that BRUKO 's products have entered overseas markets such as Europe , America, and Southeast Asia through online and offline channels such as Amazon, Toys "R" Us, 7-Eleven, and Walmart .

Although this part of the business has not contributed enough to Bruco's revenue since entering the overseas market, accounting for less than 3% , it can be seen that it is growing continuously.

From 2021 to 2023, Bruco's overseas market revenue increased from 5 million yuan, 8.3 million yuan to 10.4 million yuan, with year-on-year growth rates of 66.8% and 25.5%. In the first half of last year, the revenue of this market reached 11.2 million yuan, an increase of 135.5% compared with the first half of 2023 .

It is worth noting that until 2023, BRUKCO's North American market was its main overseas target market, but by 2024, the Asian market (excluding China) surpassed North America and its revenue share increased significantly.

But BRUCK does not intend to give up overseas markets, and going overseas is "definitely" a must.

With its leading position in the Chinese market and gradually expanding overseas IP copyrights, BRUKCO mentioned that it plans to establish cooperation with more overseas channel partners in the future, further expand the number of overseas sales outlets and coverage areas, and achieve rapid sales growth in overseas markets.

It also stated that in order to maintain growth and profitability after listing , it is necessary to successfully implement various business strategies, including expanding market share in new sales channels and overseas business .

Accelerate overseas market layout

Focusing on a single track and targeting children, BRUKO now has a total of 431 SKUs on sale , including 116 SKUs mainly for children under 6 years old, 295 SKUs mainly for people aged 6 to 16, and 20 SKUs mainly for people over 16 years old.

Looking at its core tower puzzle toys, although it started this business category in 2016, it was previously just a pure "seller" role. It was not until 2019 that BRUCK started research and development of this type of product. It was not until another three years later (2022) that the tower puzzle toys it developed generated revenue.

According to Frost & Sullivan , the global market size of role-playing toys will reach 27.8 billion yuan in 2023 and 99.6 billion yuan in 2028. As the fastest growing and most promising category in the global toy industry , Bruco has greatly increased its market share by leveraging this category, and its global market share is second only to Bandai and Lego .

From 2022 to the first half of 2024 , the gross profit margins of BRUCK's role-playing toys reached 36.8% , 48.4% and 53.3% respectively , exceeding those of its building block toys.

Currently, BRUCO's performance at home and abroad continues to grow, and it has successfully rang the bell. On the first day of listing, both the subscription amount and the frozen capital scale ranked third in the history of Hong Kong stock IPO issuance.

BRUCO has a number of patents in overseas markets including the United States, Europe, and Japan , preparing for its overseas market expansion.

In addition, it is planning to expand its team and will hire hundreds of additional international talents in R&D , sales and marketing in the future. They will be required to have overseas market experience to support the further expansion of BRUKE's sales network in multiple overseas markets such as the United States, Europe, Southeast Asia , etc.

In the future, the success or failure of overseas market expansion plans may have a significant impact on BRUK's prospects, business , operating performance and financial condition .

Through its strong product power , combined with the supply chain capabilities of "China, the world's largest toy producer", BRUCO can not only maintain its cost advantage but also continue to expand its toy categories , which will benefit its overseas market business. However, it should be noted that BRUCO is extremely dependent on popular IPs, especially Ultraman , and the authorization of this IP will expire in 2027 .

Big Sell

Listing