This Stock Is No Child's Play With A Bet On Silver Economy
The adult education company is adding products for seniors to adapt to changing times, and is now also testing out the youth market with a new toy investment
Key Takeaways:
QuantaSing bought a controlling stake in fantasy toy maker Letsvan, moving it into the fast-growing sector for experiential toys for all ages
The adult education company's rising profits and healthy cash flow should help to support the investment
Its focus is adult education, but QuantaSing Group Ltd. (QSG.US) was just a child on China's corporate scene, at 4 years old, when it debuted with a Nasdaq IPO in 2023. Now the young company is marking another milestone in its brief lifetime with an acquisition that will make it the first U.S.-listed company in the hot sector for Chinese pop toy development.
Investors applauded the company's new toy story, which saw QuantaSing announce in late March that it would acquire a controlling stake in Shenzhen Yiqi Culture Ltd., also called Letsvan, for undisclosed terms. The stock more than doubled in the days after the announcement, and, despite a recent pullback amid recent market volatility, is still about 50% higher than pre-announcement levels.
The investment marks the latest step in QuantaSing's continuing drive to diversify beyond its core adult education business into other products and offline services, so far primarily for China's growing number of seniors.
Having targeted a wide swath of the adult market, the company now seems to be setting its sights on Chinese youth, though outside the sensitive education sector. Letsvan is a rising star in China's world of experiential toys, also known by the initials ACGN, often derived from products like anime, comics, games and novels.
Like QuantaSing, Letsvan is a relatively young company, with a portfolio built around trending toy IPs including fuzzy animal doll Wakuku and Youli Ziyuli, a cute girl doll. The latter is a key product for Miniso (MNSO.US; 9896.HK), one of China's largest retailers that is also trying its hand at pop toys to tap into the ACGN boom.
QuantaSing's entry to the market ...
https://www.benzinga.com/news/earnings/25/04/44761048/this-stock-is-no-childs-play-with-a-bet-on-silver-economy