CICC: Maintaining Bruco's (00325) “Outperform the Industry” rating, the target price of HK$80 is optimistic about the growth potential of overseas and building block cars

The Zhitong Finance App learned that CICC released a research report stating that it maintains Bruco's (00325) “outperforming the industry” rating, with a target price of HK$80, corresponding to price-earnings ratios of 21.8 times and 17.1 times in 2026 and 2027, respectively, with 46% upside. The bank estimates that the company's adjusted net profit for 2026 and 2027 will be $790 million and $980 million respectively. The bank believes that Bruker has entered a period of accelerated overseas growth. Based on its product power and gameplay creativity, it is optimistic about the short-term growth potential of overseas and building block vehicles. It is expected to further open up room for growth in the medium to long term along with the “three full strategy”.

CICC's main views are as follows:

Bruker accelerates overseas and starts a new journey

Benefiting from the expansion of outlets and increased yield, Bruker's overseas revenue share in the first half of 2026 was over 20%; the share of adult-oriented products increased from 11% in 2024 to 25% in the first half of 2026; and building block cars accounted for 10.4% of revenue in the first half of 2026. Overseas travel and the expansion of category price bands have contributed to Bruke's new growth potential, and are also expected to reduce the impact of single market and category fluctuations on performance.

In the short term, overseas channels and brand building are still in the investment period. The gross margin of new products such as building block cars is still climbing, and profit margins are under phased pressure.

Globalization: Overseas accessibility and broad market space, accurate card slots help break through market share

Blue can be positioned in a market that combines building with characters and vehicles. The bank estimates that in 2025, its overseas market size is about US$27.75 billion, which is 7.9 times that of the Chinese market.

There are significant differences in the structure of major market channels, and localization is promoted according to local conditions. The bank believes that America is centered on the US; South America is expanding rapidly and has already entered the stage of network encryption and shelf deepening; Europe has a good category and population base; the company has set up new subsidiaries and front warehouses in France; Southeast Asia is widely covered by convenience stores, and the focus is shifting to single-store output.

In terms of the competitive landscape, Blue can compete misplaced with major competitors such as LEGO, Bandai, and Hasbro on popular pricing.

Building block car: innovative gameplay, space can be expected

Bruker has launched a building block car that can be assembled and modified. It has formed three price bands: C/E/S. The original car series and real car licenses will be launched one after another.

Against global leaders, Hot Wheels generated revenue of US$1.75 billion in 2025, with a compound growth rate of 12.9% from 2020 to 2025. The bank believes that the upper limit of this category is high, and Bruker products also have advantages in terms of gameplay and pricing, and future growth can be expected.

Risk Alerts

IP renewal and licensing uncertainty; overseas sales falling short of expectations; increased competition for building blocks; slowing domestic demand; gross margin recovery falling short of expectations; rising tariffs and compliance costs.