|Bid||29.500 x 0|
|Ask||29.550 x 0|
|Day's Range||29.350 - 29.900|
|52 Week Range||22.600 - 34.600|
|Beta (3Y Monthly)||0.67|
|PE Ratio (TTM)||33.32|
|Earnings Date||Aug 28, 2019|
|Forward Dividend & Yield||0.21 (0.70%)|
|1y Target Est||28.62|
Every investor in China Mengniu Dairy Company Limited (HKG:2319) should be aware of the most powerful shareholder...
The government said on Friday the Foreign Investment Review Board (FIRB) had unanimously decided that the sale of Bellamy's to Hong Kong-listed China Mengniu Dairy Co was not against Australia's interests. Mengniu is 24% owned by Chinese government entity COFCO Dairy Investments.
The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But in contrast you can...
Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of China Mengniu Dairy Company Limited and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future.
With Aussie assets up for grabs in touchy industries such as oil and civil engineering, and an agricultural deal in the works, the Australian government faces tough decisions over whether to approval sales to state-owned Chinese buyers.
Does the September share price for China Mengniu Dairy Company Limited (HKG:2319) reflect what it's really worth...
(Bloomberg Opinion) -- Selling infant formula to China seems so 2016.The country abandoned its one-child policy three years ago, spurring expectations of a baby boom. These have been well and truly dashed. Fertility rates remain stuck around the levels they’ve been at for two decades, and the 15 million children born in 2018 was the lowest figure since 1961. Roughly five Indians are born each year for every three Chinese.So what’s the country’s second-biggest milk producer China Mengniu Dairy Co. doing paying an Amazon.com Inc. valuation for milk-powder producer Bellamy’s Australia Ltd.? The answer tells you a lot about the changing prospects for the Chinese consumer.Bellamy’s, which makes organic milk and infant foods and first sold shares to the public as recently as 2014. Mengniu’s cash offer, which Bellamy’s board has recommended, is a 59% premium to the last pre-deal closing price and values the company at A$1.5 billion ($1 billion), about 30 times its Ebitda in the last fiscal year (Amazon gets just 27 times).Formula producers such as Bellamy’s, Nestle SA, and Danone SA have gone through a rough patch in China recently, driven by the slowing birth rate and a general softening in consumer spending.China’s retail sales grew just 7.5% from a year earlier in August, the National Bureau of Statistics reported Monday, the second-slowest pace since the SARS epidemic in 2003. Fixed-asset investment in food processing plants year-to-date slumped 9.4% from a year earlier, suggesting companies see dismal prospects for growth.So what’s so special about Bellamy’s? For one thing, it still benefits from the long shadow of China’s 2008 tainted-milk scandal, when products including those made by Mengniu, its majority-controlled affiliate Yashili International Holdings Ltd., and arch-rival Inner Mongolia Yili Industrial Group Co. were found to have contained the toxic chemical melamine.That’s made foreign-branded infant formula such a hot commodity in China that Australian retailers have had to implement maximum-purchase rules to stop the booming buy-overseas, post-back-home trade from clearing their shelves.That’s not enough on its own, though, given the general headwinds. After all, Mengniu tried to capitalize on this trend back in 2015 when Yashili invested 1 billion yuan ($141 million) in a New Zealand factory. The mid- to high-end image of the Kieember and Kieevagour brands produced there clearly haven’t been a Bellamy’s-level success.Yashili announced plans to sell a 49% stake in the New Zealand business to Danone for the equivalent of about $201 million last December, but the sale was canceled last month amid unsuccessful attempts to strike a broader agreement between the two companies. While the valuation uplift was clearly a positive, it’s notable that neither side was desperate to gain or retain control of the asset without getting something else in return.What makes Bellamy’s different is that it eschews the mid-range altogether. Its cans of formula sell on Alibaba Group Holding Ltd.’s Tmall marketplace for 50% more than shoppers pay in Australia, where the organic branding means it’s already a premium line. It’s not so much a bet on China’s baby boom, as on growing wealth disparities and rising affluence in a country that already accounts for a third of the world’s luxury spendingEven in that context, Mengniu will struggle to make a good return on its investment. The company plans to invest to increase capacity and drive sales, Chief Executive Officer Minfang Lu said in a statement. That’s easier said than done, given that it takes three years to convert dairy farms to organic production. Australia is a relatively small organic milk producer, with output of about 50 million liters in 2017 compared with 880 million liters in China, according to KPMG.Mengniu will need to be confident this brand can hold its own against Yili, Nestle and Danone at the top end of a fiercely competitive Chinese market. Three-quarters of its revenue at present comes from sales in Australia. While Bellamy’s is often treated as a play on Chinese demand, it’s not there yet.Shareholders in the target would do well to sell into this offer. Those in Mengniu should hope they don’t end up crying over spilled milk.To contact the author of this story: David Fickling at firstname.lastname@example.orgTo contact the editor responsible for this story: Matthew Brooker at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
The deal offers Bellamy's investors a way to cash out of a prospect that has spent years awaiting approval to sell product in its target market, China, while giving Mengniu a prized consumer brand. Foreign formula remains sought after in China following a contamination scandal a decade ago.
Half Year 2019 China Mengniu Dairy Co Ltd and Yashili International Holdings Ltd Earnings Presentation (Chinese, English)
Moody's Investors Service says that China Mengniu Dairy Company Limited's 1H 2019 results were in line with expectations, and support its Baa1 issuer and senior unsecured bond ratings. "Mengniu's revenue growth, profitability and cash flow remained stable, enabling the company to maintain a financial profile appropriate for its Baa1 ratings," says Ying Wang, a Moody's Vice President and Senior Analyst.
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Moody's Investors Service says in a new report that the price of raw milk in China (A1 stable) will continue to increase over the next 12 months, but that the two rated Chinese companies that use raw milk as an input -- China Mengniu Dairy Company Limited (Baa1 stable) and Want Want China Holdings Limited (A3 stable) -- have mitigants in place that will help them maintain stable credit metrics. Raw milk prices in China have been rising gradually since the fourth quarter of 2018, a reversal from price declines driven by oversupply over the past 1-2 years.
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