I Want You To Launch The Most Expensive Buy Back Plan In History: Where Do We Go After Selling The Grass Flavor?

A record large percentage buyback has greatly boosted your stock price.

In June 9th, I think you opened up the word limit, up to 1 million 580 thousand hands, the purchase of funds exceeded 1 billion 800 million. At the close, there are still 461 thousand and 500 hands on the limit.

On the night before, I would like to announce your announcement that you intend to use your own funds to repurchase the company's shares in a centralized bid trading mode. The number of shares repurchased is no less than 113 million shares (including), not more than 226 million shares (inclusive), accounting for no less than 21.91% of the total share capital of the company, and no more than 43.83%. The repurchase price is not more than 13 yuan / share (inclusive).

Up to now, I think you have 374 million shares in circulation. It is worth mentioning that on the day of the repurchase announcement, I think you have more than 5% shareholding shareholders, Hangzhou Hao Hong and director Qiu Hao group of the company announced that the reduction is no more than 15 million 470 thousand shares and 35 thousand and 500 shares. This big buy back plan and shareholder reduction caused widespread concern in the market.

In June 9th, I would like to think of your securities department's response to the twenty-first Century business reporter who was interviewed by investors. He said: "(shareholder reduction) and buyback are not the same thing, not a main body. At the level of the listed company, repurchase, reduction is the behavior of shareholders, and we have sold all the herbs. This is mainly about the original shareholder reduction of the grass flavor, which is not related to the listed companies. Department.

Nearly 3 billion buy back plan

I think your first purchase is not surprising.

According to the repurchase price ceiling of 13 yuan / share, the repurchase amount of 113 million shares and 226 million shares corresponds to 1 billion 469 million yuan and 2 billion 938 million yuan respectively.

I would like to say that the purpose of this repurchase share is to reduce the registered capital. The implementation period of the repurchase shares is not more than 12 months from the date of the shareholders' meeting to consider the adoption of this share repurchase program.

This means that if the 226 million shares are repurchased and cancelled, the total share capital will be reduced to 290 million shares after the repurchase shares are completed. If it can be completed, it will create a new record of A shares' historical buyback.

As of March 31, 2020, I think you have a total assets of 5 billion 425 million yuan, attributable to the parent company's net assets of 3 billion 431 million yuan, the current assets of 2 billion 185 million yuan, the book's Monetary Fund is only 670 million yuan.

If the upper limit repurchase amount and the upper limit repurchase price are calculated, the total amount of funds used for repurchase is estimated to be 2 billion 938 million yuan, accounting for 54.16%, 85.62% and 134.46% of the company's total assets at the end of March, net assets attributable to parent company and current assets.

"(repurchase specific quantities) depends on the circumstances." In response to whether the repurchase amount is too high, the Securities Department responded. As for where the money came from, the person pointed out: "we have just sold the grass flavor, and we have funds on the books."

Public information shows that in the early June, PepsiCo Beverages already wanted to pay you $698 million (about 4 billion 967 million yuan).

However, after the buy back plan has been thrown out, the shareholders' reduction plan that you want to release at the same time has raised market doubt. However, this speculation has been denied by the people in the securities department.

At present, the shareholders who want to disclose the reduction plan are all paraquat management team or original shareholders.

In 2016, when you wanted to acquire the 100% stake of Hangzhou Hauser Food Co., Ltd. ("Hauser", or "Paramount grass stockholder"), Hangzhou Hao Hong was one of the trading partners, while Qiu Haoqun was the legal representative of Hauser and also one of the shareholders after Hangzhou Hao Hong.

In recent years, Hangzhou Hao Hong has been reducing its holdings of shares. Public information shows that since September 2019 alone, Hangzhou Hao Hong has reduced the total number of shares of listed companies by 5 million 387 thousand and 800 shares.

Previously, I wish you had agreed with Hangzhou Hao Hong, the latter listed in the transaction of shares from the date of listing of shares can not be transferred within 12 months, after 12 months, the five phase of the lifting of shares transfer restrictions. Up to now, Hangzhou Hao Hong has two phases of shares not lifted.

Due to the fact that you have fully sold the "hundred grass flavor", in the evening of June 8th, Hangzhou Hao Hong changed its shares and promised to release the remaining restricted shares at once.

"Because you can't control all kinds of herbs at all, two of them basically can't achieve one plus one equals two or more than two of the economic benefits, and paraquat alliance with PepsiCo can help integrate marketing, bundling marketing and joint marketing with some resources under Pepsi line. And Pepsi is the top five hundred in the world, and I think you are not the same body size concept. So, it is very helpful for the future scale, branding and internationalization to enter the Pepsi system. Zhu Dan Peng, an analyst of China's food industry, pointed out that

The prospect is worrying.

For paraquat, climbing the high branches of Pepsi is undoubtedly the key to a "higher level". But for you, it is not good for the company to maintain good performance and growth.

In recent years, I think your performance has been growing steadily, mainly due to the strong support of the grass flavor.

According to your great asset sales bill, in 2018 and 2019, Hauser's operating income was 3 billion 900 million yuan and 5 billion 23 million yuan respectively, accounting for 78.8% and 84.26% of the total revenue, respectively. The net profit to the mother was 130 million yuan and 171 million yuan respectively.

After selling Haus, I think your business income will be reduced by 4 billion 910 million yuan in 2019, a decrease of 82.31%, and earnings per share also dropped from 0.08 yuan to 0.04 yuan.

A lot of investors are skeptical about losing you after the grass.

"The whole thing is that after you peel off the grass flavor, it has less than one billion of its revenue. Its overall purpose is very obvious, that is, cash out." Zhu Danpeng said, "I want you to say that it should focus on the main industry, but jujube belongs to a popular, regular category. There is no possibility of differentiation, and there is little room for innovation."

As a matter of fact, you can see from this year's report that the sales of jujube products are very unstable in recent years, and it has shrunk in 2019. In 2017 -2019, I think you jujube products business income were 832 million yuan, 868 million yuan and 735 million yuan, in 2019, down 16.1%, the proportion of total revenue fell from 20.43% in 2017 to 12.33% in 2019, a 8 percentage point decline.

The contribution of jujube products to your net profit is negligible or even a loss. In the past 2018-2019 years, the net profit of your non return to mother is 91 million 448 thousand and 800 yuan and 38 million 885 thousand and 800 yuan respectively, while Haus's net profit is over 100 billion yuan, more than you want to deduct the net profit.

"Selling cash from paraquat can actually be used to acquire other valuable assets or to invest, but now the big buy back and" market value management "do not create endogenetic value for the company. A researcher from a private equity firm in Southern China said, "if you really want to repay shareholders, you might as well pay dividends directly."

Despite the huge controversy over the huge buyback, it seems to you that you can expect it to happen in the future. Not long ago, I want you to announce that you have made a clear plan for net live broadcast. The Securities Department said: "at present, there is no plan for other capital operations, such as mergers and acquisitions, etc., or focus on the original main business and do the main business well. The buyback is just confident that the future of the company can really reflect the intrinsic value of the company and convey confidence to the market."

According to the person, sales data show that the company's business is in the recovery stage, and the monthly income is getting warmer. (Editor: Zhang Xing)