The picture is from the map insect network

A while ago, a children’s cheese stick with a relatively high calcium content and tasted like pudding became popular. On some short video platforms, many video bloggers have picked up this cheese stick rice.

Just a few days ago, Mengniu’s action was also related to cheese sticks-Mengniu bought 5% of the “cheese’s first share” Miao Kelando in the beginning of the year. On January 6, Mengniu issued an announcement saying that its subsidiary, Inner Mongolia Mengniu, intends to transfer 20,467,900 shares of Miao Kelanto at a price of 14 yuan per share, with a total price of about 287 million yuan. After the completion of the transaction, Mengniu will increase its shareholding in Miao Kerando to 5%. At the same time, as a strategic investor, Mengniu will also subscribe for a new registered capital of 210 million yuan of Jilin Technology, a wholly-owned subsidiary of Makrando, with cash of 458 million yuan, accounting for 42.88% of the registered capital of Jilin Technology after the capital increase.

Cheese sticks on fire on short video sites

2020 is a crucial year for Mengniu. Three years ago, it proposed to achieve the “double 100 billion” goal of 100 billion revenue and 100 billion market value by 2020. In a few years, Mengniu has made great strides in the acquisition and expansion of the scale. How far is it?

Good or bad

Mengniu and Miao Kelan Duo are partners. (Miao Ke Lan Duo’s OEM for Mengniu and its subsidiary cheese products) , Mengniu’s capital increase is good news for both parties, but in the days after the transaction announcement, the market news from Miao Kelando is quite intriguing.

January 9The straighter Miao Kelan closed at 17.25 yuan / share, up 5.83%, and also hit a new high since May 2011. (17.90 Yuan / share) . Until yesterday, (January 15th) Miao Kelando’s stock price was still undergoing “changes”, according to financial industry reports, as of 13:36 today Points, Miaokelanduo significantly increased 1.34%, a record high (previous reinstatement price) , as of the close of the day, the stock was 18.05 yuan /share.

But there are also reports that Makrando ’s shareholders have begun to reduce their holdings of the company ’s shares after a week has passed: On the evening of January 12, Makrando issued an announcement that Liu Mudong, a shareholder holding more than 5% of the company ’s shares, The auction method reduced the holding of 2,044,950 shares of the company, accounting for 0.50% of the total shares of the company.

You know, although the cheese sticks are on fire and Mengniu has increased its capital, Mighty Randall is not a qualified “buy” target. Right now it is accompanied by losses and public opinion.

According to the report of interface , Miao Kelan has increased its income in the long run. But it does not increase profits: Although the revenue increased from more than 500 million in 2016 to more than 1.2 billion in 2018, the net profit from 2016 to 2018 was 32.21 million, 42.786 million and 10.64 million respectively. What’s more, Makrando’s profits also depend on government subsidies, deducting non-recurring gains and losses such as government subsidies. In recent years, Miaoke Randuo has only made a profit in 2017.

Not long ago, Miao Kerando was caught in a storm of public opinion. In order to repay the debts of his family, his actual controller, Chai Min, illegally occupied a huge amount of funds of the listed company (Total occupied capital is 239.5 million) . However, the follow-up firewood issued an apology letter, Miao Kelanduo issued an announcement saying that the occupier had returned all the occupied funds and paid an occupation fee of 99.099 million yuan.

The financial report also shows that in the third quarter of 2019, the company’s other receivables reached 273 million. Until Mengniu increased its capital, all kinds of negative news could not go away.

Mengniu’s capital increase at this moment is wonderful. In fact, it is still in the context of this transaction that China’s cheese industry has developed rapidly in recent years.

As mentioned at the beginning, cheese sticks have been on fire on various video websites, and various cheese products such as hand-chewed cheese have also been sold. Public data shows that China’s cheese market now has a compound annual growth rate of about 25%, and the growth rate of third- and fourth-tier cities has exceeded 200%. According to the “2019-2028 China Dairy Market Outlook Report” issued by the Institute of Agricultural Information of the Chinese Academy of Agricultural Sciences, per capita cheese consumption in 2028 is expected to reach 0.5 kg, which is five times the current consumption level. (Source from public reports) .

Product marketing is gaining momentum at this moment, but whether the future cooperation will be happy depends on the company’s governance and whether the product can keep up.

The “Double 100 Billion” Challenge

Before the deal came to fruition, there was always news that Mengniu would buy Miao Landuo wholly. This is because Mengniu’s strategy in recent years is to focus on acquisitions. In order to expand the scale to achieve the double 100 billion target, Mengniu has accelerated the pace of acquisition-

In September 2019, Mengniu acquired all the shares of Bellamy Australia for a total consideration of A $ 1.46 billion. Bellamy became a wholly-owned subsidiary of Mengniu. Within two months (November 25) , Mengniu Dairy issued an announcement to acquire Australia’s second largest dairy company, Lion, for A $ 600 million in cash -100% of Dairy & Drinks Pty Ltd.

For these two transactions, Mengniu spent a total of nearly 10 billion yuan, but the results are still a little less than the target of double 100 billion.

A little finance It’s cost-effective, Mengniu’s revenue in 2018 It is 68.977 billion yuan. If you want to achieve the target, Mengniu needs to maintain a revenue growth rate of more than 20% per year this year and next. (Mengniu’s compound growth rate in the past five years is only 11.5%) . In the industry’s view, this is still not an easy goal to achieve, because the industry has not yet made clear profit expectations for its acquisition targets.

The announcement of Mengniu’s 2019 interim results shows that Mengniu achieved sales revenue of 39.857 billion yuan in the first half of last year, an increase of 15.6% year-on-year, and achieved a net profit of 2.769 billion yuan, an increase of 33% year-on-year. However, some insiders at that time analyzed that although the growth rate of net profit seemed to be much higher than the industry average, it was actually due to the small scale of the net profit base in the past two years after a net loss of 751 million yuan in 2016.

Meanwhile, Mengniu’s few high-quality assets, Junlebao, have divested Mengniu’s financial report.

In the middle of last year, Mengniu Dairy sold a 51% stake in Shijiazhuang Junlebao Dairy Co., Ltd. for a total price of RMB 4.011 billion. Data shows that of Mengniu’s 70 billion revenue in fiscal 2018, 13 billion yuan came from Junlebao. Now, this revenue will no longer be Mengniu’s asset.

In addition to the uncertainty in the data, it also faces the management challenge of the company’s personnel fluctuations. Since July 6, 2009, COFCO has invested HK $ 6.1 billion to acquire 20% of Mengniu’s equity. COFCO has become Mengniu’s largest shareholder. Mengniu has entered the COFCO era and has made numerous personnel changes.

Finally, the above financial affairs are still sorted out. After Zhao Lianshuang replaced Ning Gaoning as chairman of COFCO in 2016, Ma Jianping, vice president and director of strategy department of COFCO also replaced Ning Gaoning as chairman of Mengniu. Six months later, the former President of Yashili Lu Minfang was arranged to replace Sun Yiping as President of Mengniu. In 2018, the chairman of COFCO Lu Jun was re-designated as the chairman of COFCO. Zhao Lianshuang retired. Mengniu’s internal senior management team may not escape the new round of personnel changes.

In China, the cheese market has just started, but the dairy market is mature and the market is huge. It remains to be seen whether the “Double 100 Billion” can be realized, but whether it can seize this “cheese stick” and fight a few more beautiful battles depends on this year.