China is a major tea drinker, but the domestic tea market is relatively scattered. Although a large number of well-known tea chain brands such as Tianfu , Wu Yutai , Zhang Yiyuan , there are few listed companies in the domestic stock market whose main business is related to tea planting and operation.
Compared with domestic tea brands, the new tea drink brands such as Heytea , Naixue, Cha Yan Yuese , Mixue Bingcheng , etc., which are low-key and lonely than domestic tea brands, are built on tea raw materials, but their current tea drinks are in full swing and have attracted the attention of the capital market. In just a few years, the "first tea drink stock" was born.
Although there are few tea listed companies in A shares , Hong Kong stock has a tea company that has been listed for more than ten years - Tianfu (06868.HK), which is Tianfu Tea. Through Tianfu, let us have a glimpse of the tea industry.
, the ten-year-old tea company VS legend founder,
, Tianfu Ming Tea can be traced back to 1993, when , Li Ruihe, whose ancestral home is Zhangpu, Fujian, founded a tea shop in mainland China.
Li Ruihe has a legendary life experience, and his family has made a living by growing tea for generations. In 1953, Li Ruihe opened the "Mingfeng Tea Store" in Gangshan, Kaohsiung and began selling tea.
Fortunately, his entrepreneurial journey was experiencing the dividends of Taiwan's economic development at that time, and his tea business became bigger and bigger. The tea shop not only opened all over Taiwan, but also founded many upstream and downstream enterprises such as Tianren Tea Factory, Tianren Tea Garden, Luyu Tea Art Center, etc., and created the "Tianren Group" centered on tea.
But life is impermanent, and sadness and joy are intertwined.
At that time, Li Ruihe, who was successful in the tea industry, saw the carnival in the stock market and established Tianren Securities to do an investment business. Unfortunately, he encountered a financial crisis. In 1990, the "Tea King" suffered a loss of NT$3 3 in the market value, and his career returned to zero in just one year.
After experiencing failure, pain and struggle, Li Ruihe chose to make a comeback.
In 1993, Li Ruihe cooperated with the Fuzhou Agricultural Reclamation Bureau to jointly operate the Youshan Tea Farm, and Li Ruihe was also responsible for selling tea. He used the "Tian" of "Tianren" and the "Fu" of "Fujian" to name the new company " Tianfu Group ", and Tianfu Tea came into being.
In 1994, Li Ruihe opened the first Tianfu Tea direct store in Fuzhou City. Although the quality, packaging, storefront and service of tea were rare in the domestic market at that time, the retail sales were pitifully low at first, even less than 100 yuan a day.
Li Ruihe firmly believes that the country's fortune will flourish, and tea will flourish. He believes that with the rise of China's economy, Tianfu Tea will eventually usher in the dark. He didn't care about the gains and losses of a city and a pool, so he chose to continue opening a store. After
gained a foothold in Fujian, Tianfu began to expand nationwide and consciously focused on localization. In Beijing, Tianfu focused on launching the jasmine tea that northerners love to drink, winning a large northern market.
has cultivated more than ten years of cold and heat in mainland China. Tianfu Tea has become China's leading traditional Chinese tea product enterprise, with production bases in Fujian, Sichuan, Guangxi Zhuang Autonomous Region, Zhejiang and Guizhou Province.
company has developed more than 1,800 Tianfu series products, including oolong tea, green tea, black tea, Pu'er tea , flower tea, white tea and other packaged tea and tea bags, as well as tea food, tea sets, tea art supplies, fragrant and other series.
These products have been planned and built into many brands such as "Tianfu", "Tianfu Tianxin", "Ankeli", "Tianxi", "Cow Spot", and "Yucha Qu TO GO". They include both traditional tea and new and fresh tea beverage brands (including milk tea), so as to occupy various market segments of Chinese tea beverages.
is also the founder's emphasis on the capital market. As early as 2011, Tianfu was listed on the Hong Kong main board, with net proceeds of approximately RMB 933 million, becoming the earliest tea brand to be listed. Listing financing also provides strong financial support for subsequent company store expansion and acquisition of store properties.
, which makes it bigger and stronger, has become a well-known brand in the Chinese tea industry. The company won the title of "Top 100 Comprehensive Enterprises in China's Tea Industry" selected by the China Tea Circulation Association from 2013 to 2021. According to data from China Enterprise Brand Research Center , Tianfu was selected as the first in the 2019 China Tea Chain Store Brand Power Index.
performance fell, gross profit declined
As a part of big consumption, Tianfu's performance was also severely hit by the new crown epidemic.
In the first half of 2022, the company achieved revenue of RMB 800 million, a decrease of 14.8% from the same period in 2021, while the profit recorded during the period was RMB 75.1 million, a decrease of 52.6% from the same period in 2021.
The company's revenue decline in the first half of the year was mainly due to the impact of the new coronavirus disease, and the company's factories and physical stores in various cities in China were partially suspended.
Affected by the epidemic, the company's four major business segments, tea, tea food, tea sets, and other (mainly government subsidies) have been hit hard.
Tea and tea food, two major business segments with sales of over 100 million yuan, contributed about 585 million yuan and 102 million yuan respectively in the first half of the year, accounting for about 73% and 13% of revenue respectively; compared with the same period last year, these two major businesses contributed about 671 million yuan and 120 million yuan respectively, down about 13% and 15% year-on-year respectively.
tea sets and other businesses achieved revenue of RMB 95 million and RMB 21 million, respectively, a decrease of 11.21% and 53.33% respectively compared with the same period last year.
Due to the adjustment of product structure and the decline in retail share, the company's gross profit margin fell from 57.1% in the first half of 2021 to 55.1% in the first half of this year.
As of June 30, 2022, Tianfu has about 185 own retail stores and 1,135 distributor stores in mainland China, accounting for about 41.3% and 56.5% of the total revenue respectively. This figure has been reduced compared with about 208 own retail stores and 1,105 distributor stores on December 31, 2021.
Tianfu's performance declined significantly in the first half of this year. Compared with the company's past interim performance, except for the company's performance in 2021, the growth rate of revenue and net profit has been slowing down since 2018.
Looking further, since its listing in 2011, the company's revenue has continued to stop moving forward except in 2021. Reflected in the capital market, the company's stock price has been fluctuating around HK$5 per share since it achieved a high increase in 2018, and the rise is weak. This has a lot to do with the company's performance, tea characteristics and liquidity of Hong Kong stocks.
tea companies are difficult to go public, new tea drinks are popular, and Tianfu Xiaoshou's test
tea companies are difficult to go public. For a long time, there were no tea companies listed in A-shares, and there were only two companies, Tianfu and Longrun Tea (02898.HK) in the Hong Kong stock market. However, Longrun Tea has been suspended from since June 2017, and was forced to delist by the Hong Kong Stock Exchange last year.
However, since 2020, a trend of tea companies has emerged, including Zhongcha Co., Ltd. , Lancang Ancient Tea, Bama Tea Industry and other competition for the "first stock of A-share tea companies", but the listing process is not smooth. After that, Lancang Ancient Tea switched to Hong Kong stock IPO.
Why is it difficult for tea companies to gain capital favor? Some industry insiders believe that tea is an agricultural product, and it is relatively difficult to standardize, scale and brand. On the other hand, the industry concentration is low, the number of small and medium-sized enterprises is large and scattered, and the industry threshold is low, making it difficult to form scale and brand effect .
And a strange fact is that it is not good to sell tea, but it is good to sell tea drinks. Although it is difficult for tea companies to gain favor from the capital market, the emerging new tea drinks in recent years have deeply won the love of the capital market, and many well-known tea drink brands such as Naixue's Tea , Heytea, and Mixue Bingcheng have been born.
With the rapid development of the Chinese tea beverage market, Tianfu has continuously adjusted the types of tea products and developed diversified product lines, creating a real-time tea beverage brand "Cow Spot" and "Yucha Fun TO GO" mainly targeted at young people, to cater to new market demand.
In addition, the company has also established a food research and development department, and launched fruit wine, tea food (such as mooncakes), Kinmen sorghum wine co-branded by Tianfu Ming Tea, bird's nest and black tea-flavored Buddha Jump the Wall and other products, which are in line with the current popular pre-made dish field and can also effectively boost performance.
Relatively speaking, Tianfu can stand firm in the tea market and capital market, and the stock price remains stable, which is closely related to the company's founder Li Ruihe who sent Tianfu to the capital market ten years ago. At the same time, it is also closely related to the company's continuous brand building and marketing that keeps pace with the times is closely related to the product strategy .
Author: Qingweile
