superfood listed company

At present, there are no listed companies in the domestic A-share market whose pure main business is superfood. Companies with related businesses are mainly scattered in two tracks: agricultural product processing and functional food. The existing targets generally have three core characteristics: low business proportion, ununified industry standards, and differentiated valuations.

Not to mention, I recently went with a researcher from the consumer group of a brokerage to conduct research on community retail channels in Hangzhou. Half the wall of the expiration discount store was piled with kale powder, freeze-dried acai berry chunks, and chia seed oatmeal crisps. The cashier complained that the turnover rate of these two types of goods was 30% higher than that of ordinary nuts, and the expiration rate was less than 5%. Young people only carried three or four bags to their homes. The consumer side is so popular, but the capital market has no corresponding pure play (pure business) target, which is quite interesting to say.

I asked people from different circles and the opinions were quite different. Most investors in the primary market feel that the time has not come yet. There is no unified official definition of "super food". You may say that quinoa and chia seeds count, but some people say that low-glycemic ordinary grains and high-vitamin C wild berries also count. There is no national standard to support it. How to calculate the main business when it is listed has to be audited for half a month. Previously, a start-up brand of freeze-dried superfoods approached us as FA (financial advisor). The revenue classification alone was changed three times. One was rough processing of agricultural products, the other was functional foods, and finally gave up on the short-term IPO plan.

Analysts in the secondary market are more pragmatic and feel that the core problem is that the business model cannot support the requirements for independent listing. The vast majority of superfood raw materials rely on imports, and pricing power is entirely in the hands of overseas production areas. Last year, due to drought in South America, the purchase price of chia seeds increased by 47% in four months. Do downstream brands dare to increase prices casually? Consumers turned around and bought affordable flax seeds as substitutes, and the gross profit margin was not stable at all. Listed companies that are now arranging related businesses basically treat it as an incremental business. For example, Tomson By-Health’s functional food line has long added raw materials such as kale and acerola cherries. Simai Food’s chia seed mixed oatmeal revenue accounted for 8%. Daodaoquan is also promoting functional oil products such as oleic acid rapeseed oil, but no one dares to bet all their wealth on it. At most, it is a new growth curve of “icing on the cake”.

Interestingly, the controversy about superfood itself is also one of the core reasons why capital does not dare to give up easily. There is a school of thought that superfoods are purely marketing IQ taxes. The so-called "high nutrition" can be completely replaced by ordinary food combinations. Avocados that were previously sold for more than ten yuan each are now available for 5 yuan each in supermarkets. The trend is retreating faster than anything else, and it is easy for listed companies to fall into the trap of all-in. There is also a group of people who believe that this is a long-term trend. The demand of Generation Z to control sugar and calories and pursue a healthy diet is real. The consumption penetration rate of domestic superfoods has increased by more than 20% every year. Companies and other industry standards that are now deployed in advance can reap the first wave of dividends. Last year, the Ministry of Agriculture and Rural Affairs has issued industry standards for quinoa. In the future, standards for more categories will definitely follow. If you don’t occupy a position now, it will be too late.

I also came into contact with a northern oat processing listed company last year. I originally wanted to spin off its superfood business and enter the New Third Board, but finally gave up. Firstly, independent accounting requires building an extra team and paying a lot more taxes. Secondly, I asked a circle of investors in the secondary market at that time. The understanding of this concept is polarized. Some people are willing to give 30 times PE, while others think it is just a hot topic and are only willing to give 10 times. The valuation difference is too big, so they can simply put it in the parent company as a new business and slowly grow it. When the revenue scale of more than 1 billion in a single category is achieved. Looking at their annual report a while ago, the revenue of this line has exceeded 300 million, and the growth rate is more than twice as fast as the traditional oat category.

Oh, yes, there was a listed company that grew green leafy vegetables before. Just because it announced that it had planted 200 acres of kale to supply online brands, its stock price rose for three days in a row. Later, it made an urgent announcement that this business accounted for less than 1%, and then it fell back. Magic is magic, and it can be seen that the market's expectations for this track are indeed not low.

In fact, the entire track now is like Greek yogurt that has not yet been fermented. The raw materials, consumers, and supply chain are all in place, but the temperature and strains have not yet reached the most suitable point. Some people find it sour and are unwilling to wait, while others have already reserved a seat in advance to wait for it to become sweet. As for when the first listed superfood company with pure main business will be launched, I estimate that it will take three to five years. When a category like room-temperature yogurt actually enters the refrigerators of thousands of households, and the standards, profits, and awareness are all in place, it will naturally fall into place.