The first fruit IPO is here in China, and the market value of Hong Jiuguo is 19 billion yuan

Today, the first stock of the fruit was born.

The investment industry-Tiantian IPO was informed that today (August 31), Chongqing Hongjiu Fruit Pin Co., Ltd. (referred to as "Hong Jiu Guo") officially landed on the Hong Kong Stock Exchange. On the first day of listing, Hong Jiugo opened at HK $ 40, and the increase in the market once reached 3%, with a maximum market value of 19 billion Hong Kong dollars.

In the 1990s, Deng Hongjiu, who was poor in his family, joined the Chongqing "Stick" army early. Occasionally, Deng Hongjiu discovered the difference between the fruits and Chongqing city in his hometown, so he did the wholesale business of the fruit. In the 20 years, Deng Hongjiu joined forces to make Hong Jiuguo from a small wholesaler into China's largest brand fresh fruit distributor, with an annual income of 10 billion.

Is it a good business to sell fruits? Today, China Fruit Rivers and Lakes have three points in the world -Nanbai Fruit, Beixianfeng, and Xi Hongjiu, corresponding to Belong Garden from Shenzhen, Xianfeng Fruit from Hangzhou, Hong Jiu Fruit from Chongqing. They have grown up in the same era , I stood in front of the IPO door in an all -round way. Quietly, the fruit shops at the entrance of your community went to the market.

A "stick" counterattack in Chongqing:

The husband and wife sell fruit, today IPO knocked on the bell

In Chongqing, there is a special occupation: great, this is a name for the local pick. The rural army from the countryside assumed the heavy responsibility of short -distance transportation in Chongqing City, which was poorly transported. In the early years, Deng Hongjiu was one of them.

(Image source: Hong Jiu Guopin's official website)

In the early years, Deng Hongjiu, 17, had a difficult student at home. He carried a flat burden at Chaotianmen Wharf in Chongqing and joined the "Bang" army. Obviously, the same red oranges, the price of longevity in hometown was lower than the price of Chaotianmen Wharf, so the idea of ​​red orange wholesale was hit.

This is the first intersection of Deng Hongjiu's life. In 1987, Deng Hongjiu used his savings to live in more than 2 tons of red oranges from his hometown, and picked it to Chaotianmen Wharf for sale. The price of red oranges in my hometown was 0.3 yuan, and Deng Hongjiu was sold at 0.6 yuan. I did not expect that the red oranges were sold out in two days and earned more than 100 yuan, which was more earned than before. Inspired by this, Deng Hongjiu simply lost the burden and started a fruit wholesale business.

In 2002, Deng Hongjiu and his wife Jiang Zongying established Chongqing Hongjiu Fruit Products Co., Ltd., wholesale business became more and more popular. Three years later, a news once again changed Deng Hongjiu's entrepreneurial direction: 15 kinds of Taiwanese fruits will implement zero tariffs. At that time, Deng Hongjiu's supply had gone out of his hometown and spread across many cities in China. He began to think about it. If the fruits in Taiwan were introduced to Chongqing, even if the price was high and did not make money, Hong Jiu fruit would show his face.

Therefore, at a exhibition, Deng Hongjiu reached a cooperation with a company in Taiwan to transport the first batch of 4.4 tons of Taiwan fruits to the Chongqing market. Sure enough, Hong Jiu fruit was red. This battle made Deng Hongjiu see a wider channel and market. He began to unite local wholesalers and aimed at imported fruits.

At first, Deng Hongjiu had to wholesale imports from Guangzhou, Shanghai and other places to Chongqing. This has a problem: Guangzhou and Shanghai are used as a first -level market. They must buy from local to Chengdu and other second -tier markets. The price is getting more and more expensive, and you must face the risk of outdoor at any time. Deng Hongjiu realized that if you want to import fruits to survive, only the place of origin- "purchase from Southeast Asia, the first choice for Thailand", another vision was opened.

In 2011, Deng Hongjiu began to explore imported fruits in Thailand. With longan as a breakthrough point, after long -term purchasing, Deng Hongjiu established a bilateral market. He established a factory in Thailand, hiring those familiar with Zhongtai bilingual as a professional manager, and after gaining the trust of the local fruit farmers, received a lot of longan from the scattered fruit farmers; on the sales side, Deng Hongjiu successively cooperated with more than a dozen provinces wholesale market cooperation. Supply to digest tens of thousands of tons of fruits wholesale from Thailand.

The bilateral market brings a scale effect. The distribution network of Hong Jiuguo is getting bigger and bigger. From Thailand to Southeast Asia, the fruit category has gradually covered durian, mangosteen, and dragon fruit. In 2016, Hong Jiuguo received the first financing, with more than 50 million yuan Pre-A round financing. That is, in this year, the new retail concept proposed by Alibaba once again made Deng Hongjiu see the opportunity.

(Hong Jiuguo's business, source: prospectus)

With the first funds, Hong Jiuguo quickly entered the supply chain of Hema Xiansheng and Suning Store, and set up a front position to meet the daily delivery needs of the store. Subsequently, Hong Jiuguo completed the base chain layout of the base-production-warehousing-sales sorting-logistics-terminal customer.

Investors came one after another, and in 2018, Hong Jiuguo won three rounds of financing. Among them, at the end of the year, the round B financing lineup was strong, and well -known institutions such as Shenzhen Venture Capital, China Merchants Capital, Sunshine Life, and Chinese Farmers reclamation entered the bureau. One year later, Hong Jiugo once again completed the C1 round of financing led by CMC capital, and the financing scale was as high as 500 million yuan.

In 2020, Hong Jiuguo's sales revenue exceeded 5 billion yuan and completed the last financing invested by Alibaba, with a valuation of about HK $ 8.4 billion. The prospectus shows that before the IPO of Hong Jiu fruit, the chairman and executive director Deng Hongjiu held 27.7937%of the shares; his wife Jiang Zongying was the executive director and general manager of his wife, holding 9.4304%, and Ali accounted for 8%of the shares.

In the 20 years of entrepreneurship, Deng Hongjiu counterattacked the king of the fruit step by step from Chongqing's "stick". Hong Jiu fruit also covered more than 300 cities across the country from the unknown small wholesalers, becoming the largest fruit dealer in China. Today, Hong Jiuguo officially landed on the Hong Kong Stock Exchange to create the first fruit IPO. Imported Durian King

With an annual income of 10 billion, the capital chain is still tense

Relying on distribution, Hong Jiuguin contracted your fruit freedom.

The prospectus shows that Hong Jiuguo is focusing on the entire industry chain operations that are mainly native to fruit in China, Thailand and Vietnam. For nearly 20 years in the fruit industry, Hong Jiugo has formed a combination of fruit products with durian, mangosteen, longan, dragon fruit, cherry, and grapes. The largest imported fresh fruit distributor in Southeast Asia.

The freedom of your durian may not be realized yet, Hong Jiuguo has achieved the freedom of supply of durian for you. In 2021, durian has become China's largest imported fruit category, with retail sales of 52.4 billion yuan. Based on the sales revenue of that year, Hong Jiu fruit is the largest durian distributor in China, with a market share of 8.3%. Every time the Chinese eat 10 durians, there is almost one from Hong Jiu.

At the same time, Hong Jiuguo is also the top five distributors of dragon fruit, mangosteen and longan, with market share of 2.2%, 6.1%, and 2.8%, respectively. Several core products have achieved amazing revenue growth for Hong Jiu fruit.

From 2019 to 2021, Hong Jiuguo achieved revenue of 2.078 billion yuan, 5.771 billion yuan, and 10.28 billion yuan, respectively, with a compound annual growth rate of 12.2.42 %, and the two -year revenue increased by 4.9 times; the adjustment of net profit was 228 million yuan. , 662 million yuan and 1.090 billion yuan, the compound annual growth rate was 118.48%, and the net profit margin reached 11.0%, 11.5%, 10.6%, and 13.0%, respectively.

However, its gross profit is not high. From 2019 to 2021 and 2022, as of May 31, Hong Jiuguo's gross profit was 393 million yuan, 957 million yuan, 1.613 billion yuan, and 1.123 billion yuan. 19.6%. The gross profit margin continued to decline for three consecutive years, and it did not usher in the turning point until May of this year.

In this regard, Hong Jiuguo explained in the prospectus that this is mainly due to the gradual change of the previous marketing strategy and the new crown epidemic. When other suppliers cannot supply fruit in time, the company's "end -to -end" supply chain model guarantees The stable supply of fruits. Under this model, Hong Jiu fruit products have been directly mined in the fruits. At present, nearly 400 local teams have formed nearly 400 employees in Thailand and Vietnam, and processing plants have been established in the core fruit producers to achieve standardized operation of the origin. At the same time, there are 16 fruit processing plants near the orchard in the Orchards in Thailand and Vietnam. In addition, it also benefits from the rapid growth of new retail channels. In 2021, the revenue of the emerging retail channels of Hong Jiuguo Pin was 2.133 billion yuan. In 2019, the number was 471 million yuan, and the compound annual growth rate reached 112.81 %. This channel is divided into four directions: community group purchase, community fresh chain store, instant e -commerce, and comprehensive e -commerce. Among them, due to the impact of the epidemic, community group purchases jumped from 271,000 in 2019 to 544 million in 2021 Revenue increased by more than 2000 times in two years.

However, it is not necessary to ignore that even if the revenue increases rapidly, the capital chain of Hong Jiuguo products is still tight, and the operating cash flow continues to be negative. From 2019 to 2021, and 5 months before 2022, the company's operating cash flow was -450 billion, -804 million, -982 billion, and -801 billion, respectively. The pressure of funds brings more liability pressure. Among the short -term debt of the company, the amount of bank loans and other borrowings has doubled. During the reporting period, bank loans and other borrowings were 1 million yuan, 67 million yuan, and 875 million yuan. , 1.576 billion yuan.

Prior to this, Hong Jiuguo's road to listing was three times. In 2013, Hong Jiuguo traded OTC Market OTC Market Chongqing Municipal Transfer Center, and actively tried to promote the relevant matters related to the listing of the New Third Board by 2014-2015; in 2019, Hong Jiuguo and Dongxing Securities signed a listing counseling agreement to try to enter A shares; in October 2021, submitted a prospectus to the Hong Kong Stock Exchange, but all ended in failure.

A wave of twists and turns was not submitted to the prospectus again until May of this year. In July, the hearing was passed. Hong Jiuguo finally ushered in the market. After IPO, can high revenue relieve the pressure of cash flow? This is a realistic problem in front of Hong Jiuguo.

Fruit shop running three IPOs

Young people, are you free to achieve fruit freedom?

Right now, the fruit kings collectively IPO.

The fruit world has the saying that "South Pyrodiac, Xi Hongjiu, Bei Xianfeng". Now, Hong Jiu Guo products carry the banner of "the first stock of the fruit", and the other two giants are also being sprinting. In May of this year, three days after Hong Jiu Guo's table was delivered, Baiguoyuan also submitted a prospectus to the Hong Kong Stock Exchange.

Similarly, since the 1990s, Yu Huiyong from Jiangxi dropped the "iron rice bowl" to Shenzhen south. After some toss, Yu Huiyong saw the hidden business opportunities of the fruit chain industry, so he called Xu Yanlin, the wife of his wife in his hometown, two. People opened the first Paiguoyuan store. The store's sales in the first month of the store reached 410,000 yuan, which made the Yu Huiyong couple more firmly determined to do fruit business. Unlike the B -end layout of Hong Jiuguo, Beluo Garden is mainly facing the C -end market. After many models iteration, Yu Huiyong designed a new franchise plan, and the store expanded rapidly. More than 20 years have passed, Bai Guo Garden has spread to over 130 cities across the country, with over 5,300 stores, with a total of over 67 million members, becoming China's largest retail company in China.

The prospectus of Baiguoyuan shows that from 2019 to 2021, the company's revenue was 8.98 billion yuan, 8.85 billion yuan and 10.29 billion yuan, respectively, corresponding to 248 million, 45 million and 226 million, and the net interest rate remained at 2%- Between 3%, the income is considerable, but the profit is small.

At the same time, there is a group of strong investment institutions standing behind Baiguoyuan. Since 2015, Baiguoyuan has conducted eight rounds of financing. Tiantu Investment, Shenzhen Venture Capital, CICC Capital, Cornerstone Capital and other institutions have entered the bureau. Among them, the B -round financing amount in 2018 was as high as 1.5 billion yuan. In the last financing of February 2020, the valuation of Belong Garden was reported to have risen to 12 billion yuan.

On the other hand, Xianfeng Fruit was terminated in January 2021 after signing a listing counseling agreement with CITIC Securities in December 2019. One month later, Xianfeng Fruit turned to the CITIC Construction Investment Securities as a listing counseling broker. At present, the first phase of listing counseling has been completed.

Xianfeng Fruit was founded in Hangzhou in 1997, and the founder Han Shuren came from Anhui. At that time, Han Shuren held 80 yuan, starting from a tricycle and a booth of less than 4 square meters. After 25 years of development, Xianfeng Fruit finally made Xianfeng Fruit into a new retail, smart cold chain logistics and supply chain B2B platform B2B platform Globalized enterprises.

Although Xianfeng Fruit has only disclosed 3 rounds of financing, there are many institutions such as Sequoia China, Jiuding Investment, Qianhai Wutong M & A Fund. At present, the number of Xianfeng stores exceeds 2,200, which has five brands: Xianfeng Fruit, Akchao, Fruit Wharf, Yang Guopu, and Xianguo Terminal, and have set up more than 300 cooperative planting bases worldwide.

China is the largest consumer consumer in the world. Data show that my country's fresh fruit retail market size has increased to 1.34 trillion yuan in 2021. With the upgrading of consumption and further integration and optimization of the market, the market is expected to continue to expand at a compound annual growth rate of 9.2%in the next five years. Reach 2 trillion scale.

(Picture source: prospectus of Hong Jiu Guopin)

However, this track's meager profits and high supply chain requirements have always been controversial in VC/PE institutions. Investors from a VC institution in Shenzhen said they were not optimistic about the fruit track. He once said that the fruit industry has more uncertainties, especially fresh fruits are very easy to rot, and they have high requirements for the inventory cycle and supply chain; Investors are optimistic about this business. The main logic is the broad market, and the performance after forming a scale can maintain a certain increase.

An investor who has participated in Hong Jiu fruit finance attributed the fruits to the track category of fresh freshness. She believes that the large -scale, chain and online of fresh freshness are a very obvious trend. The opportunity of the road is huge and full of competition. This is evident in the fresh e -commerce company that had been fighting.

On the one hand, the fruit shop piles the IPO, and on the other hand, the fruit has quietly increased the price. I do n’t know when, the fruit was ridiculed as the first step in the freedom of contemporary life. The more and more fruit stores are open, but the freedom of fruit seems to be farther and farther from the young people.

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