Author | Capital Markets Department
Source | Mustang Finance
Yili Mengniu "tear each other" soon, the dairy market will be up again!
On the evening of July 1, Mengniu (2319.HK) will sell all 51% of Junlebao's shares, with two companies in Hebei. Mengniu and Junlebao have been married for nine years, and the former has earned ten times the income, plus a total net profit of about 4 billion yuan.
Mengniu "let go" this time, Junlebao, known as "Little Mengniu", is bound to become more free and flexible in the market. Hebei Dairy, which was hit hard by the "melamine incident" in the past, is also trying to re-emerge after more than ten years of hard work.
9 years of marriage "good gathering and good dispersal"
On November 22, 2010, Beijing held an important dairy company conference, the protagonists were Mengniu and Junlebao. Not only business representatives, but also local government representatives attended the meeting. After the "Melamine Incident", the cooperation between the yogurt market leader and the fourth child affected the hearts of many people. Liu Guoguo, chairman of the China Dairy Association, said at the press conference:
"The cooperation between Mengniu and Junlebao has three conformances. The first is in line with the spirit of economic transformation in the "Twelfth Five-Year Plan"; the second is in line with the industry policy of dairy resource reorganization and the increase in industry concentration; the third is in line with the law of market economy from competition to competition."
Finally Mengniu justified its 51% stake in Junlebao at a price of 469 million yuan and was promoted to a major shareholder.
Source: Junlebao's official website
Nine years later, Mengniu announced that it would transfer all of its shares in Junlebao for 4.011 billion yuan, but the reason is that Junlebao and Mengniu Group have different product positioning and emphasized that Junlebao has always Operating independently. Although Mengniu made a net profit of at least 3.5 billion in this business.
Regarding the equity transfer, a relevant person in Mengniu told Yema Finance (WeChat public number: ymcj8686), “This transfer of shares in Junlebao Dairy is in line with our company’s development strategy of focusing on star dairy products, as well as the company’s and shareholders’ Overall benefits. I wish Junlebao a better performance in the future.”
Therefore, this marriage will be "good for gathering and scattered" after 9 years.
In 1995, Wei Lihua founded Junlebao, relying on a yogurt machine, two tricycles, and three small bungalows, walking the streets and alleys, and slowly accumulating funds. Since starting from scratch, Wei Lihua has an axis of focus on what he believes.
In 1999, Sanlu Group invested in Junlebao through "brand + cash", holding a total of 34% of the equity.
Who ever thought that the Sanlu Group had an accident within a few years. In 2008, the "Melamine Incident" broke out, and the "milk powder empire" Sanlu had built for many years collapsed. Subsequently, Jun Lebao spent 25 million yuan to repurchase part of the shares as the priority holder.
In November 2010, Junlebao officially joined hands with Mengniu and became a holding subsidiary of Mengniu. Mengniu holds 51% of Junlebao.
Although the majority shareholder of Junlebao Dairy has changed hands several times, the management rights have always been controlled by the founder, Wei Lihua. In 2014, Junle Dairy was no longer limited to the production and sales of yogurt, but began to enter the infant milk powder market.
Today, milk powder revenue has reached 40%, becoming Junlebao's core business. In 2018, Junlebao milk powder achieved sales revenue of more than 5 billion yuan, and it has entered the first camp in the milk powder industry.
Hebei Dairy has been moving forward with difficulty since the fall of Sanlu Group, until Junlebao has been carrying it forward for many years, finally let Hebei Dairy see the hope of revival.
The milk powder boss regained his glory
As early as 2017, Junlebao achieved an annual income of 10.2 billion yuan and successfully entered the 10 billion dairy club. This is the fourth domestic dairy product that broke the 10 billion mark after Yili, Mengniu and Guangming. enterprise. Today, the dark horse of Junlebao has become a leader in Hebei dairy industry and shoulders the hope of Hebei dairy industry's revival.
For Hebei Dairy, 2008 was a hurdle. Prior to this, Hebei Dairy has long been a signature of China's dairy industry. Its milk powder production and sales have been the top spot in the country for 15 consecutive years, occupying nearly 20% of the country's market, and it is the country's largest producer of infant formula milk powder.
However, the "melamine incident" will bring HebeiThe dairy industry is at a trough. Domestic milk powder is not favored, and imported brands quickly monopolize the Chinese dairy market. According to Taobao's incomplete statistics, in 2014 alone, the scale of infant formula through overseas purchases reached about 10 billion yuan.
is under such an opportunity, Jun Lebao started its own milk powder.
In 2012, Wei Lihua was invited to Germany to participate in the packaging industry exhibition. As a result, more than 50 Chinese people went with him. They went straight to the supermarket when they got off the plane and purchased milk powder box by box.
As a dairy entrepreneur, this scene must have impressed Wei Lihua. This also gave him the idea of making milk powder. Subsequently, Wei Lihua set out to prepare for the official production of Junlebao milk powder in 2014. In the following three or four years, Junlebao milk powder was recognized by the market and entered the Hong Kong and Macau markets.
As of September 2018, Junlebao milk powder orders exceeded 3.6 billion yuan, and Junlebao entered the first camp of domestic infant milk powder. With the rise of Junlebao, Hebei Dairy has come back to life.
Actually, about the transfer of Junlebao's equity, the clues began as early as 3 years ago. In May 2016, Zhao Shuanglian, Chairman of COFCO Group, met with the leaders of Hebei Province at the Fulinmen Building. One of the issues discussed by both parties was the equity restructuring of Junlebao. In August 2018, Lv Jun, Chairman of COFCO Group, once again discussed in-depth cooperation with senior officials of Hebei Province at COFCO Fulinmen Building.
met twice, which shows Hebei's desire to revive the dairy industry. Today, the influence of melamine has dissipated, and China's dairy industry is in an era of rapid development. Hebei is unwilling and cannot miss this high-speed train for the development of the dairy industry.
According to the announcement disclosed by Mengniu, Shijiazhuang Penghai Fund and Shijiazhuang Jungan Management will acquire 26.7% and 24.3% of Junlebao respectively for a total price of 4.011 billion yuan. Mengniu will no longer hold any equity in Junlebao after the transaction is completed.
Tianyan check information shows that the actual controller of Penghai Fund is the Hebei SASAC. The major shareholder managed by Jun Qian is Su Lei, and another company that Su Lei participates in, Shijiazhuang Zhongrongtong Investment Consulting Co., Ltd., is inextricably related to Wei Lihua. After the transfer of
equity, Wei Lihua will be promoted from the second shareholder to the major shareholder. And Junlebao, which was raised by Wei Lihua, has undoubtedly become the dark horse of the dairy industry and is reviving Hebei's dairy industry. As for whether it will land in the Chinese stock market, the market is full of rumors.
The dark horse came out, and the A shares were added? Although
is on the independent listing, Junlebao said it has not considered it at present, depending on the needs of the company's subsequent development. But Hebei Province is no longer obscure about this.
Image source: "Hebei Province Dairy Industry Revitalization Plan in 2019"
On April 12, 2019, Hebei Province released the "Hebei Province Dairy Industry Revitalization Plan in 2019". The plan stated that it would "support the listing of Junlebao Dairy Group on the main board and expand financing channels. "It is also clear that the Hebei Provincial Securities Regulatory Bureau is responsible for this matter.
Obviously, as a benchmark enterprise in a major dairy province, Junlebao's listing has been put on the agenda. To be listed, independence from Mengniu has become a matter of course. Food and beverage expert Xiao Zhuqing told Yema Finance (WeChat public account: ymcj8686) that Junlebao “is reliable to go public because it has good performance and its valuation should be relatively high.”
Picture source: Oriental Securities Research Report
Jun Lebao's performance in recent years has been quite impressive, and the market share of its yogurt, milk powder and other products is steadily increasing. Since Junlebao’s revenue exceeded the 10 billion mark for the first time in 2017, the company has set a development goal of exceeding 30 billion in sales in the next five years. With the lessons learned from "Sanlu", Junlebao attaches great importance to product quality control and pioneered the "two industry models" and "four world-class" standards, which are also the basic guarantee for its continuous growth.
"Two industrial models" refers to: 1. The whole industrial chain self-control mode, that is, planting, raising, and adding the whole industrial chain is integrated and self-controlled to ensure the safety and security of raw milk; 2. With the "four world-class" standards Produce "world-class" good milk powder. The so-called "four world-class" refers to the self-built modern farms, the selection of the world's top suppliers, the construction of the world's leading factories, the introduction of the dual management system of the global food safety standard BRC and the international food safety standard IFS.
In August 2016, Junlebao milk powder announced its entry into the Hong Kong market and was praised by the industry as a "domestic infant formulaAn important sign of the resumption of exports of milk powder” is also a performance of its quality. On January 28 this year, Junlebao released its 2018 performance data. Its 2018 annual revenue was 13 billion, an increase of 28% year-on-year. Among them, the sales of milk powder broke 5 billion yuan, an increase of more than 100% year-on-year, and the proportion of group revenue increased from nearly 10% in 2015 to 38.46%.
Currently, Junlebao is still 4 years away from completing the target of 30 billion revenue Time, if it can be successfully listed, it will be a great help to achieve its goal. Xiao Zhuqing believes that after Junlebao is listed, its future development trend may lay upstream and downstream, "The first is the construction of upstream milk sources, which is raising cattle; The downstream may be involved in the construction of the sales system and network sales terminals. "
Will Junlebao finally land on the stock market? With the breakup of its nine-year marriage with Mengniu, this conjecture is becoming one of the focuses of the capital market. Where will Junlebao rise from the ruins? What will you do about it? Look, welcome to leave a message to express your opinion.
