To The Moon

$CMON(01792)$

Could CMON Be the Next Pop Mart?

CMON Limited, headquartered in Singapore, is a publicly listed company on the Hong Kong Stock Exchange, specializing in the design, development, and sale of board games, tabletop games, miniatures, and graphic novels. Its business model focuses on:

Product Development and Publishing: CMON creates and publishes proprietary and licensed tabletop games, including board games and miniature war games. It designs products for hobbyists and gamers, targeting niche markets with high engagement.

Global Distribution: The company operates across North America, South America, Europe, Asia, and Oceania, selling through multiple channels:

Crowdfunding Platforms: CMON heavily utilizes Kickstarter to fund and market its games, leveraging pre-orders to gauge demand and reduce financial risk.

Wholesalers and Retail: Products are distributed to wholesalers and sold through physical and online retail, including CMON’s own online store and a physical store in Singapore.

Game Conventions: CMON organizes and participates in conventions to promote and sell products directly to consumers, enhancing brand visibility and community engagement.

Diversified Revenue Streams: In addition to game sales, CMON offers sales administrative services and operates coolminiornot.com, a platform for user-submitted painted miniatures, fostering community interaction and brand loyalty.

Intellectual Property and Licensing: The company develops its own IPs while also licensing popular franchises, allowing it to cater to varied consumer preferences and expand market reach.

Why Investors Should Study CMON (1792.HK):

Niche Market Growth: The global tabletop gaming industry has seen steady growth, driven by increasing interest in hobbyist and collectible games. CMON’s focus on high-quality, thematic games positions it to capitalize on this trend, appealing to investors seeking exposure to the gaming sector.

Crowdfunding Advantage: CMON’s successful use of Kickstarter mitigates production risks by securing funding upfront, providing a unique business model that blends creativity with financial prudence. This approach can attract investors interested in innovative revenue strategies.

Global Reach with Scalability: Operating in multiple continents, CMON has a broad market presence. Its scalable distribution channels (online, retail, conventions) offer potential for growth, especially in emerging markets.

High Volatility and Risk Considerations: The stock’s volatility (weekly volatility decreased from 19% to 13% but remains higher than 75% of HK stocks) and significant price swings (52-week range: HK$0.011–HK$0.075) suggest potential for high returns but also elevated risk. Investors should study its financials (e.g., EBITDA of HK$26.10M, market cap of HK$21.67M) to assess valuation and sustainability.

Challenges and Red Flags: Investors should note CMON’s reported negative return on investment (-13%) and equity (-8.91%), low market cap, and lack of analyst coverage, indicating limited institutional interest. Recent issues, such as delayed share subscription payments, and a potential delisting risk warrant careful scrutiny.

Speculative Opportunity: With a low share price (HK$0.014 as of June 2025) and a history of sharp declines (-51.72% over the past year), CMON may appeal to risk-tolerant investors looking for undervalued or turnaround opportunities, provided they conduct thorough due diligence.

Could CMON Be the Next Pop Mart?

Pop Mart’s meteoric rise (stock up 584.71% in the past year, market cap HK$277.99 billion) stems from its ability to tap into a global, youth-driven collectible craze, scalable retail operations, and strong financial performance. To assess if CMON could follow a similar trajectory, let’s compare key factors:

Growth Potential:

Pop Mart:

Benefits from a scalable blind box model that creates addictive consumer behavior and a strong secondary market.

Aggressive global expansion (e.g., Europe, U.S.) and a robust online/offline retail strategy drive revenue growth (HK$9.03 billion half-year revenue).

Strong analyst support (average price target HK$214.63, with a high of HK$303.00) and a “Buy” consensus reflect confidence in its growth.

CMON:

Growth is constrained by its niche market and reliance on crowdfunding, which, while innovative, lacks the mass-market appeal of Pop Mart’s model.

Limited financial data (e.g., no recent revenue figures publicly available) and operational challenges (e.g., payment delays) hinder its ability to scale rapidly.

Expansion potential exists if CMON can develop a breakout IP or adopt more mainstream marketing strategies, but it currently lacks Pop Mart’s infrastructure and brand momentum.

Market Positioning:

Pop Mart:

Positioned as a lifestyle brand, appealing to a broad demographic of young, affluent consumers with trendy, collectible products.

Its $40 billion market cap surpasses Hasbro and Mattel combined, reflecting its dominance in the designer toy market.

CMON:

Strong in the tabletop gaming niche but lacks the cultural or mainstream appeal to compete with Pop Mart’s broader market positioning.

Its community-driven model (e.g., conventions, coolminiornot.com) is a strength but not yet scalable to Pop Mart’s level of consumer engagement.

Financial Health:

Pop Mart:

Robust financials: HK$5.39 billion EBITDA, 38.14% margin, and HK$2.39 billion half-year net income.

Dividend yield of 0.43% (projected to grow to 1.3% in three years) and insider buying (HK$16 million) signal confidence.

CMON:

Weaker financials: HK$26.10 million EBITDA, negative ROE, and zero EPS suggest profitability challenges.

No dividend data and governance issues (e.g., delayed payments) raise red flags.

Valuation and Investor Sentiment:

Pop Mart:

Trades at a high P/E ratio of 37.47, reflecting growth expectations but also potential overvaluation concerns.

Analyst optimism (e.g., JPMorgan’s HK$250.00 target) and a 584.71% yearly gain indicate strong market confidence.

CMON:

Low valuation (HK$0.020 share price, HK$43.34 million market cap) suggests potential undervaluation but also reflects market skepticism.

Lack of analyst coverage and a “Sell” technical signal limit its appeal to mainstream investors.

Potential for CMON to Emulate Pop Mart:

Upside Scenario:

CMON could become a “next Pop Mart” if it develops a viral, mass-market IP or adopts a scalable retail model (e.g., blind box-style tabletop miniatures).

Expanding its online presence or leveraging social media to mimic Pop Mart’s community-driven app could boost engagement.

A successful turnaround in financial performance and resolution of governance issues could attract investor interest.

Challenges:

CMON’s niche market and operational challenges make it unlikely to achieve Pop Mart’s scale without significant strategic shifts.

Pop Mart’s success is tied to a broader cultural trend (collectible toys), while tabletop gaming remains a smaller, less mainstream market.

Financial constraints and delisting risks pose immediate hurdles to replicating Pop Mart’s growth trajectory.

As part of a barbell strategy, if you are invested in the Terrific Ten and Pop Mart, CMON could be a low cost entry into a highly successful business model catering to a niche market. As today's restless youth look toward emotional attachment to collectibles to relieve their daily stress, CMON could easily pivot to cater to a growing market for vintage and nostalgia as the online exhausted community yearn for the simpler ways of the past those of us old enough to remember. 

The continued success of board games like Monopoly both offline and online versions speak volumes of a huge global market. 

Investors should study CMON for its niche market leadership and innovative crowdfunding model, but caution is advised due to its financial challenges, high volatility, and potential delisting risks. Analyzing its financial statements, market trends in tabletop gaming, and management’s strategy to address payment delays is critical before investing.