Semico Capital riding the Pop Mart, arcade trends

KUCHING (Dec 31): Malaysian firm Semico Capital Bhd (Semico) is set to benefit from its wide distribution network, with products available across 303 customer stores nationwide, spanning specialised convenience stores, hobbyist stores, toy stores, as well as cinemas and family entertainment centre (FEC) operators.

A key anchor customer is Mix Metro Sdn Bhd (Mix Store), which operates 108 specialised convenience stores in Malaysia, with Semicoís toys and collectables placed on a consignment basis in 105 outlets, supported by a four-year business relationship.

An analysis from Mercury Securities Sdn Bhd (Mercury Securities) saw that Semico provides exposure to the continued diffusion of North Asia pop-culture and entertainment trends into Malaysia, particularly from Japan, Korea, and Greater China.

Rising consumer willingness to pay for character-led content has translated beyond media into collectibles, blind-box formats, and arcade entertainment, supporting repeat and impulse-driven spending.

“By acting as a local distributor and operator of proven North Asia formats, Semico captures this demand without assuming intellectual property (IP) creation risk, positioning the group to monetise established trends with relatively high earnings visibility,” it said yesterday.

“This behavioural willingness to pay has translated beyond media into merchandise and collectibles, reinforced by high-visibility exposure of ‘Pop Mart’ products, including organic showcasing of Labubu collectibles by leading K-pop artists; and official collaborations with major K-pop acts in2024ñ2025.

“Together, these factors support accelerating adoption of character-led collectibles and blind-box formats in Malaysia, consistent with a lagged diffusion of North Asia pop-culture trends.”

Mercury Securities noted that the commercial viability of this monetisation model is validated by its scalability in Greater China, where blind-box formats have demonstrated strong revenue expansion and repeat-purchase dynamics, providing a reference point for mature adoption.

Notably, Semicoís toys and collectibles segment has grown materially faster from a smaller base, indicating Malaysiaís earlier-stage adoption of a proven IP-driven monetisation model rather than replication of China-level outcomes.

“More importantly, Semico captures this growth without assuming IP creation risk, leveraging its local distribution network and retail footprint,” it udnerscored.

“In parallel, Semicoís arcade segment monetises Japanese-origin game formats that emphasise experiential value and repeat play, supporting recurring, utilization-driven revenue.

“Overseas sales of Japanese content, particularly games and animation, have recorded sustained growth, underscoring the scalability of Japanís entertainment formats beyond their domestic market.”

Meanwhile, the team from Malacca Securities in another reported lauded Semico’s rapid machines deployment, driven by revenue-sharing and rental model.

“Semico demonstrated strong scalability in its arcade and amusement machine business, with the number of machines expanding from 58 units in FY22 to 650 units in FY25, representing a 3-year cumulative annual growth rate (CAGR) of 123.8 per cent.

“This rapid growth is underpinned by the groupís revenue-sharing and rental model, which enable swift deployment of machines at customersí premises while minimising inventory risk, as machines are only procured upon securing customer orders or signed agreements, with a utilisation rate of 98.2 per cent as of FY25.

“Supported by routine maintenance, servicing and game updates, this model delivered an attractive gross profit margin of 64.8 per cent in FY25.”