Laopu Gold (6181 HK): Capturing Post-Lockup Gains Amid Gold's Bull Run

Investors in Laopu Gold Co., Ltd. (6181 HK) are poised to benefit from two powerful catalysts converging in late June 2025: the expiration of a 69 million H-shares lock-up and the relentless upward trajectory of global gold prices. With the stock price hovering near HK$868.50 as of June 2025 and a market cap of HK$149.11 billion, the company's valuation is primed for further expansion. This analysis explores how structural liquidity shifts, gold price dynamics, and the potential for a stock split could unlock outsized returns for proactive investors.

The Lock-Up Expiry Catalyst: A Liquidity Game-Changer

The June 27, 2025 lock-up expiry for 69 million H-shares represents a pivotal inflection point. Historically, lock-up expirations can pressure stock prices as institutional investors exit positions. However, in Laopu Gold's case, the narrative is far more bullish.

First, the company's 12-month stock surge of over 2,300% (from ~HK$34 in mid-2024 to ~HK$868 in June 2025) has already priced in significant optimism. Second, the lock-up holders—likely QDII funds or strategic investors—may choose to retain stakes given the stock's strong fundamentals. This reduces the risk of a sell-off and could instead attract new capital chasing liquidity.

Moreover, a potential stock split—hinted at in analyst reports as a tool to boost retail investor participation—could further amplify liquidity. A split would lower the per-share price, making the stock accessible to smaller investors. While no official announcement has been made, the strategic logic is clear: a split would dilute volatility and create a more stable, widely held equity, aligning with Laopu's luxury branding ambitions.

Gold's Bull Run: The Engine of Earnings Growth

Laopu Gold's financial health is inextricably linked to gold price trends. Since late 2024, COMEX gold has surged to record highs, hitting $2,712.7/ounce in October 2024 and forecast to breach $3,000 by 2025. This tailwind has supercharged Laopu's margins:

• Revenue growth: For 2023, revenue hit RMB 3.28 billion (+145% YoY). In H1 2024, revenue jumped to RMB 3.52 billion (+148% YoY).
• Net income: Surged to RMB 5.87 billion in H1 2024 (+198% YoY), driven by premium pricing and cost discipline.

The company's gross margin of over 41% dwarfs competitors like Chow Tai Fook (15–20%), underscoring its pricing power. Analysts at CICC and Guolian Securities have highlighted that every $100 rise in gold prices translates to a ~5% increase in Laopu's net income, making it a leveraged play on gold.

Valuation: Still Room to Run

Despite the stock's meteoric rise, Laopu Gold remains underappreciated relative to its growth trajectory. Key metrics:

• Market Cap Growth: From HK$11.55 billion (June 2024) to HK$149.11 billion (June 2025), a 1,209% CAGR fueled by revenue expansion and brand premiumization.
• Forward P/E: At 18x (vs. peers at 25–30x), the stock is cheap for a company growing at >100% annual revenue CAGR.
• Dividend Yield: A 6.88 HKD dividend in May 2025 (adjusted for splits) signals confidence in cash flow, with future payouts likely rising as earnings scale.

The Case for a Strategic Buy Now

The confluence of lock-up expiry, gold bullishness, and retail investor accessibility (via a potential split) creates a compelling risk/reward setup:

1. Post-Lockup Liquidity Surge: Reduced institutional selling pressure and new retail inflows could stabilize the stock, reversing its recent volatility (which saw swings of ~40% in months).
2. Gold-Driven Earnings Upside: With gold prices near all-time highs, analysts like UBS see 2025 revenue hitting HK$20 billion (+135% YoY), fueling multiple expansion.
3. Split Catalyst: Even unconfirmed, the mere whisper of a split could spark speculative buying ahead of the lock-up expiry.

Investment Recommendation

Buy Laopu Gold (6181 HK) with a 12-month target of HK$1,200+.
- Entry Point: Use dips below HK$850 as buying opportunities, leveraging the June lock-up expiry as a catalyst.
- Risk Management: Set a stop-loss at HK$750 to protect against macro gold selloffs or liquidity shocks.
- Long-Term Thesis: The stock's underappreciated valuation, gold-linked earnings, and structural liquidity improvements position it to outperform peers in 2025 and beyond.

In a market hungry for growth and gold exposure, Laopu Gold offers a rare blend of execution excellence, premium brand positioning, and catalyst-driven upside. Act now—before the lock-up expiry and gold rally turn skeptics into believers.