The integration of culture and commerce continues to expand as a dominant trend in the consumer market. From cultural and creative products to domestic fashion brands, an increasing number of companies are attempting to transform traditional cultural elements into scalable consumer goods. While the collectible toy industry often discusses the "blind box economy" of POP MART, another niche yet substantial segment—copper-based cultural artifacts—sees a company dubbed "the POP MART for middle-aged men" making a renewed push for a Hong Kong listing. After terminating its A-share listing guidance and seeing its initial Hong Kong application lapse, Tongshifu has recently passed a hearing with the Hong Kong Exchanges and Clearing, moving closer to its market debut.

Leveraging improvements to the ancient lost-wax casting technique and the strategic use of intellectual property (IP) licensing, Hangzhou Tongshifu Cultural and Creative (Group) Co., Ltd. has grown to become the market leader in its sector within a decade. However, with revenue heavily dependent on online channels, fluctuating net profits, and vulnerability to copper price swings, the question remains whether its listing prospectus signifies a leap in brand value or a forced maneuver in a challenging capital environment.

The company's core competitiveness lies in its deep integration of ancient copper casting methods with modern industrial design and IP management, carving out a standardized brand path in a highly fragmented metal crafts market. According to a Frost & Sullivan report, China's copper cultural and creative products market is a concentrated niche, with an estimated size of approximately RMB 1.576 billion in 2024, where the top three players collectively hold over 70% market share. Hangzhou Tongshifu Cultural and Creative (Group) Co., Ltd. leads significantly, commanding 35.0% of total revenue share and 44.1% of online revenue share.

This dominance stems from a unique product strategy: transforming traditionally expensive copper artworks into more affordable cultural products with collectible and decorative appeal through industrial refinement. However, underlying this success is the inherent limitation of the market's size. Having already captured over one-third of the market, the company's annual revenue has plateaued in the RMB 500-600 million range.

In terms of IP strategy, the company focuses primarily on self-developed IP, supplemented by licensed properties. According to the prospectus, the vast majority of revenue comes from self-developed IP products, consistently contributing around 90% of total revenue from 2022 to 2024. To break out of its niche market constraints, the company has aggressively pursued an "IP harvesting" model in recent years, enriching its product portfolio through licensing agreements with globally recognized IPs such as *The Avengers*, *Transformers*, *Game of Thrones*, and *Nezha 2*. Revenue from the top five IPs accounted for approximately 20% to 24% of total revenue between 2022 and the first nine months of 2025. While these collaborations drive traffic—the launch of the official *Nezha 2* collectible figure attracted significant attention—they also carry risks, as high licensing fees and marketing expenses can erode profit margins. A net profit decline in 2023 was largely attributed to increased sales and marketing expenditures and costs associated with technological upgrades.

By the end of 2024, the company had launched 707 new SKUs, using frequent iterations to maintain brand freshness and market responsiveness. To overcome growth constraints tied to a single material, the company has expanded into other materials through sub-brands like "Xijiang Gold Store," "Yueyin," and "Happy Little General," venturing into gold, silver, wooden artifacts, and even plastic collectible toys.

Despite its leading market share, the company's financial performance has been volatile. Revenue grew from RMB 503 million in 2022 to RMB 571 million in 2024, but growth slowed noticeably in 2023. Annual profit followed a V-shaped trajectory, dropping 22.5% year-on-year to RMB 44.131 million in 2023 due to temporary production decreases from technical upgrades and rising sales, marketing, and R&D costs. In the first nine months of 2025, net profit fell 22.0% compared to the same period in 2024, with the net profit margin narrowing from 13.8% to 9.3%, impacted by approximately RMB 12.8 million in listing expenses and rising raw material costs. This pattern of revenue growth without corresponding profit increases highlights the financial pressure from weaker consumer purchasing power and lower average order values for discretionary items like cultural products amid macroeconomic fluctuations. The online average order value fell sharply from RMB 958 in 2022 to RMB 598 in the first nine months of 2025, reflecting a strategic shift toward entry-level SKUs to reach a broader audience, but also indicating changing consumption patterns.

Another significant risk is the heavy reliance on online sales channels. A large portion of the company's revenue in China comes from a few third-party e-commerce platforms like Tmall, Douyin, and JD.com, with online sales consistently accounting for about 80% of total revenue. While this centralized channel strategy provided high operational efficiency and rapid growth initially, it now presents challenges as the company seeks to go public and broaden its appeal. Dependence on these platforms means rising customer acquisition costs and vulnerability to changes in platform algorithms and commission policies. In response, the company has accelerated the expansion of its offline directly operated stores, doubling its network from 18 to 36 stores since 2024, aiming to counter peak online traffic risks and boost sales of higher-priced items through immersive retail experiences.

As a raw material-intensive business, the company's profitability is significantly affected by copper price fluctuations. Direct material costs consistently represent 47% to 52% of total operating costs, meaning sustained increases in copper prices could directly compress profit margins.

As the leader in the copper crafts segment, Hangzhou Tongshifu Cultural and Creative (Group) Co., Ltd. has succeeded by infusing cultural sentiment into metalwork and effectively targeting the high-purchasing-power demographic of middle-aged men. However, under the scrutiny of an IPO, challenges such as a limited market ceiling, channel concentration, and profit instability are now evident. Whether the company can leverage the Hong Kong capital market to evolve from a copper manufacturer into an innovative cultural platform and break the cycle of declining order values and traffic concerns remains to be seen.