Pop Mart Short Sellers Face Losses as Stock Rebounds

Short sellers keep betting against Pop Mart. However, the trade is not working well. In fact, Pop Mart shorts losses are rising as the stock rebounds. According to S&P Global Market Intelligence, Pop Mart is unique. It is the only heavily shorted Hong Kong stock where bears are losing money. As a result, tension between bulls and bears continues to grow.

Rising Short Interest Signals Market Divide

Short interest in Pop Mart reached 12.67% recently. This figure increased from 11.3% in April. Therefore, bearish sentiment remains strong despite recent losses. At the same time, the stock has shown recovery. Shares have gained 8% since April lows. Although the price dropped earlier, it now shows resilience. Consequently, short sellers face increasing pressure. Bears argue that demand is slowing in overseas markets.
For example, some point to weaker interest in the Labubu toy line. They also question long term growth. However, bulls strongly disagree. They highlight new product launches and global expansion. In addition, they believe the stock offers attractive value. Citigroup analyst Lydia Ling supports a positive outlook. She maintained a buy rating in June. Still, she lowered her price target due to short term volatility.

Growth Concerns and Strategy Shift

Not everyone shares the bullish view. Bernstein analyst Melinda Hu kept an underperform rating. She pointed to weaker overseas expansion compared to China. Moreover, company leadership signaled a shift in strategy. CEO Wang Ning described 2026 as a “pit stop year.” This means the company will focus on stability over rapid growth. As a result, growth may slow in the near term. However, the company aims for sustainable progress.

Short Sellers Face Rising Risks

Short sellers now face growing challenges. Nearly 92.4% of shares available for borrowing are already used. Therefore, entering new short positions is difficult. In addition, borrowing costs remain high. This reduces potential profits for bearish traders. As a result, the risk of further Pop Mart shorts losses continues to rise.