China’s Warning on Blind-Box Toys Sends Pop Mart Shares Sliding

Pop Mart International Group Ltd. shares dropped in Hong Kong after a Chinese state media commentary called for stricter regulation of blind-box toys and trading cards, stoking concern over the company’s wildly popular Labubu dolls business.

While the commentary didn’t call out Pop Mart by name, it spooked traders who have propelled the company’s stock to a nearly 170% gain this year amid the craze for its toothy monster dolls. Pop Mart often sells its dolls inside a blind box, which means the buyer doesn’t know what specific character is inside until they open it.