On November 19, according to Reuters IFR, Weilong Foods plans to IPO in Hong Kong next year. Internationally renowned investment institutions such as CICC, Morgan Stanley and UBS have cooperated with Weilong and plan to raise US$1 billion.
In recent years, Weilong has grown rapidly. The company's revenue in 2019 was 4.9 billion yuan, a year-on-year increase of 43%. Brand founder Liu Weiping stated at the Weilong Foods 2020 Partner Conference that Weilong’s goal this year is 7.2 billion yuan. At the same time, according to the 2018 plan, Weilong will sell for 10 billion in 2021. According to
Tianyan inspection, Weilong Foods was founded in 1999 and its subsidiary is Luohe Pingping Foods Co., Ltd. (hereinafter referred to as "Pingping Foods"). Its main products include seasoned noodles, bean products, vegetarian foods and meat products. Wait.
, as the company's flagship product, Weilong Spicy Tiao has become a "national" snack. However, Pingping Food and Weilong Spicy Tiao have repeatedly been exposed to quality problems. Dr. Ding Huiren, a visiting scholar at the Central University of Finance and Economics, said that Weilong’s listing in Hong Kong cannot circumvent the problems of food safety and excessive use of additives. Unhealthy food labels may hinder Weilong’s listing.
In addition, the company also has hidden worries such as single product structure and congested track.
was rumored to be listed in Hong Kong for the second time.
In December 2018, Weilong was also rumored to be listed. At that time, some industry insiders close to the Weilong manufacturer confirmed to the media that Weilong really wanted to go public, but the purpose and timetable for the listing were uncertain.
Before that, Weilong had frequent business changes. According to
Tianyan Check and Industrial and Commercial Information, from 2013 to 2016, Liu Weiping held 60% of Pingping Food and Liu Fuping held 40%.
In September 2017, shareholders Liu Weiping and Liu Fuping both withdrew, Pingping Food was changed to a wholly-owned shareholding by Luohe Weilong Trading Co., Ltd., and the company's market entity type was also changed from a limited liability company (natural person investment or holding) to a limited liability company (Wholly owned by a legal person that is not invested or controlled by a natural person).
In March 2018, the registered capital of Pingping Food surged 300% from 30 million to 120 million yuan. In the same year, the company's business scope underwent a substantial change.
Liu Weiping once responded, "Listing may be a process of ours, but it is not the goal and the result. It will be uploaded wherever we go. There is currently no idea that we must go on the market. Don’t go public for the sake of listing. Be anxious and let the flow go."
Now, Weilong is sending news about the listing, and media reports say that the listing time may be in the second half of next year. According to Tianyan, Pingping Food is indirectly controlled by Hehe International Business Co., Ltd. after penetrating the third floor.
It is worth noting that Hehe International is a Hong Kong company established in July 2018. Luohe Hehe Food Technology Co., Ltd., which is directly held by it, was established in August 2018 with a registered capital of US$4.6 million. Relevant information shows that if the company's registered capital is expressed in US dollars, it may be a Sino-foreign joint venture or pure foreign investment.
According to media reports, the two shareholders of Luohe Weilong Trading Co., Ltd. are registered in the British Virgin Islands. Shen Meng, director of
Xiangsong Capital, believes that Weilong Food’s shareholding structure has changed from pure domestic capital to pure foreign investment. This type of shareholding structure will not need to be reviewed by the Mainland Securities Regulatory Commission during the listing process, thus speeding up Weilong Food’s listing in Hong Kong. .
has reshuffled the industry into a giant
. Based only on revenue in 2019, Weilong has surpassed a number of listed companies including Laiyifen and Yanjin Shop in the leisure snack field, although it is with the three squirrels. There is still a gap between Liangpin Shop, but if the company achieves its expected revenue target, it will be among the first echelon of listed domestic leisure snack companies.
has grown from a small workshop to a snack giant about to go on the market, how did Weilong stand out?
In 1978, Liu Weiping was born in Pingjiang County in northeastern Hunan. In this impoverished county, the palace tribute dried sauce, which has been circulating for more than 1,000 years, is an essential craft for locals to support their families.
In 1998, Hunan suffered a catastrophic flood. The crops were severely damaged. The production capacity of soybeans, the main raw material for dried sauce, decreased, and the price rose sharply, which caused a considerable impact on the original industry. In order to reduce the cost, the three masters of the Jianggan Workshop replaced dried beancurd with gluten, and made a substitute with similar taste but much cheaper price, which is the embryonic form of spicy noodles today.
Because of its simple production, the early production threshold of spicy strips was extremely low, and a large number of small workshop-style "underground producers" emerged on the market. However, Pingjiang is a mountainous area, where flour is not produced, and local companies have neither raw material advantages nor sales advantages. Therefore, around 2000, many people from Pingjiang began to go out of Hunan and bring spicy strips to all parts of the country, and Liu Weiping was one of them. How high is Pingjiang’s contribution to the national spicy strip industry? According to the statistics of CCTV in 2019, the total output value of spicy strips nationwide is 58 billion yuan, and Pingjiang County accounts for about 20 billion yuan. Among the more than 1,000 spicy strip companies in the country, there are 343 in Pingjiang County; the spicy strip industry arranges more than 30 jobs nationwide Ten thousand people, 100,000 people will be employed in Pingjiang County. In addition, according to incomplete statistics, among the thousands of spicy tiao enterprises nationwide, those founded by Pingjiang people account for more than 90%.
Liu Weiping, who was born in the "Hometown of Spicy Tiao", chose Luohe, Henan Province as the first stop for his own business. In Luohe, Liu Weiping found inspiration from the traditional snack beef tendon noodles and developed the current Weilong spicy noodles. In 2003, it applied for the registration of the "Weilong" trademark. A year later, Weilong became the country's first spicy strip enterprise to enter the industrial park.
In 2006, Weilong's second production base was put into use in Zhumadian. Subsequently, Weilong hired celebrities Zhao Wei and Yang Mi as endorsements in 2010 and 2012. He also created foods such as kiss-boiled and beef sticks and gradually entered the soy product market.
In 2014, Weilong dry crispy noodles and konjac production lines were completed and put into production. The company also completed the renovation of its own plant at a time of crisis of trust in the spicy strip industry, and invited professional teams to take pictures in the fully automated aseptic production workshop, trying to change consumers' understanding of Weilong's "junk food".
In 2015, taking advantage of the e-commerce trend, Weilong entered platforms such as Tmall, JD.com, Suning.com, and overseas Amazon. With the establishment of online channels, Weilong’s marketing team has repeatedly presented "classic" on social platforms. The work".
In 2016, used Taobao live broadcast to invite Internet celebrity Zhang Quandan to live broadcast at Weilong Workshop; launched Hotstrip7.0 through iPhone7; stopped cooperating with Lotte through "THAAD Event" in 2017; made mobile game "Weilong Hegemony"; launched in 2019 Including various peripheral products such as quilts and satchels... A series of operations of
even attracted netizens to comment, "Where there are hot spots, there are Weilong Foods".
In 2000, there were more than 4,000 seasoning and noodle products companies in Henan, and only 236 companies remained in 2017. The big wave of the industry has made Weilong gradually transformed into the leader among them.
In 2019, Weilong’s overall revenue was 4.909 billion yuan, of which terminal direct sales revenue was 2.55 billion yuan, circulation channels were 1.8 billion yuan, and e-commerce channels were 559 million yuan. It is reported that only Weilong’s konjac products have annual sales of 83.06 million, a year-on-year increase of 170.03%.
Frequent complaints about food safety problems
Weilong and the spicy strip industry are developing in full swing, and food safety problems also follow. For this reason, the spicy strip companies headed by Weilong have had a long "game" with the regulatory authorities.
At the end of 2005, CCTV reported the use of prohibited additives in a food factory in Pingjiang County; in 2007, the General Administration of Quality Supervision, Inspection and Quarantine listed Pingjiang as a key county for food safety rectification in the country and carried out a major rectification of the spicy strip industry.
Weilong Food has also been found by the Market Supervision Administration and Food and Drug Administration of Zhejiang, Guiyang, Shanxi, Hubei and other provinces, adding sorbic acid and its potassium salt, dehydroacetic acid and its sodium salt to its products for preservative Agent.
In 2015, Luohe City Quality Supervision Bureau issued a notice of punishment for using unqualified products instead of qualified products for the self-burning and large gluten produced by Pingping Food. According to statistics, from 2015 to May 2017, a total of 195 batches of hot strips from 131 hot strip production companies in 15 provinces across the country were on the blacklist of the Food and Drug Administration, with unqualified food additives being the main reason.
In 2018, the Hubei Food and Drug Administration announced that Weilong and other brands of spicy strips were unqualified. In this regard, Weilong Foods stated that its products are produced in accordance with the standards of Henan Province where they are produced, and the products are fully qualified. In order to solve the problem of inconsistent standards in various regions, the State Administration for Market Regulation issued an announcement on seasoned noodle products in December last year, and established a national standard for the spicy strip industry.
In the "March 15 Party" in 2019, the chaos in the spicy strip industry was once again exposed by CCTV. In this regard,Zhu Danpeng once said in an interview that although Weilong's current production hardware and environmental management are still relatively standardized, after the 315 party is exposed, it will still cause a certain impact. For Weilong, which is rumored to seek a listing in Hong Kong, food safety issues and excessive use of additives are always hidden dangers that cannot be bypassed.
Ding Huiren said that after CCTV 3.15 party exposure, the industry regards spicy strips as high-salt, high-sugar, high-calorie, high-irritating "junk food", food safety issues and excessive use of additives, unhealthy food will become synonymous with health Long "listed in Hong Kong" exam problem. In addition to being named by regulatory agencies, Weilong has also received complaints from upstream and downstream users, including distributors and consumers. Among the complaints of
black cats, some consumers claimed that the spicy strips they received had become moldy or that they had eaten insects, hair, stones and other foreign objects in the packaging.
Tianyan check shows that Pingping Foods and its shareholder Weilong Trading have been involved in 11 and 27 court announcements respectively this year. Pingping Foods has been involved in 101 lawsuits in its history, mostly involving product liability disputes and product seller liability disputes. The crowded product structure of
track needs to be expanded.
"Last year there were tens of millions in sales of spicy strips. This year, the company will officially enter the spicy strips industry and strive to achieve sales of 1 billion yuan (single products) within 5 years." In April this year , Zhang Xuewu, chairman of Yanjin shop, said in an interview.
Nowadays, leisure snack giants headed by Three Squirrels and Liangpin Shop have opened up their own spicy strip business.
"The scale of China's spicy strip industry in 2018 was 58 billion yuan, and the average gross profit margin of spicy strips was close to 50%. The high gross profit naturally attracted capital to join in." Zhu Danpeng said.
In addition, Radar Finance browses e-commerce platforms such as Tmall and JD.com and found that the prices of spicy strips for the three squirrels, Liangpinpu, Yanjinpu, and Weilong are all around 10-15 yuan, and the price can be reduced to 10 yuan after participating in the discount. Below, three squirrels and Yanjin shop can even be as low as 8 yuan or less.
At the same time, related snack companies often implement full reduction activities, and consumers can choose different types of snacks in the same store to participate in the activities. But in terms of such activities, stores with more product categories may be more selective. At present, the nuts, bread and other products in stores such as Three Squirrels and Liangpin Shop are not available in Weilong.
According to the research report of Pacific Securities, the online casual snacks sales data in October showed that the top three snacks in sales were pastries/snacks, biscuits/puffed and pecans/nuts/roasted seeds. Z1z
Ding Huiren told Leda Finance that there are many types of consumer food products and complex structures. At present, Weilong's brand advantage is far less than that of similar products, and it is more difficult to compare with comprehensive snack brands such as "Three Squirrels". Over-reliance on star products will slow the listing process. From the current analysis of Weilong's product structure, its R&D capabilities need to be further improved.
In addition, Ding Huiren also pointed out that from the perspective of Weilong’s revenue structure, the company still has great potential in short video and e-commerce network platforms, and after listing, Weilong may also develop a track layout in high-end food.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-