By MA Yue

On Monday, Chinese toymaker Pop Mart International Group took its first pounding since its splendid debut in Hong Kong.

On December 28, Pop Mart's Hong Kong-listed hit its lowest level of HK$72.05 (US$ 9.29) per share, a drop of 16.4 percent. By the close of trade, the price had settled at HK$77.65. Nearly HK$15 billion was wiped from its market value.

The problem is the recent exposure of items being repackaged for resale. A customer claimed to have bought three of Pop Mart's signature blind boxes at an outlet in Jinan, east China's Shandong Province. She spotted traces of glue on the seal and creases on the material in one of the boxes, indicating that it had been repackaged. A video posted online shows the customer returning to the outlet to find other blind boxes in the store with similar problems.

In the early morning of December 24, the customer posted another video with an official reply from Beijing Pop Mart Culture and Creative Company Limited, admitting that it had confirmed that five shop assistants were involved in repackaging. On December 21, the company fired the five and removed all the goods involved from the shelves.

Immediately, the topic became a hot search topic on Weibo. A repackaged blind box equates to deprivation of the consumer’s core experience, which may result in a crisis of confidence.

The blind box mechanism refers to collectors’ toys sold in opaque, sealed boxes, hence the customers do not know what they are buying before actually opening the box. The average price of a box is 59 yuan. The entire business model lies in collecting hidden or rare toys known as "super-hidden figurines". Owing to the marketing strategy, rare figurines fetch good prices on second-hand platforms with speculators often driving up prices.

On December 26, state-backed media Xinhua News Agency commented that "Behind the surprise and expectation lie the excessive consumption bred by addiction and gambling mindset amid the 'blind box frenzy' […] Parents and teachers ought to steer minors toward healthy spending habits […] regulatory authorities should further regulate the business."