On the morning of June 8th.
Henglong Building 28 layer Chairman's Office.
As soon as Zhao Chen sat down in the office, Chen Xi knocked on the door and came in.
"Zhao Zong, US Stocks operation was completed last night."
She placed a printed transaction report on the table, with excitement that could not be concealed in her tone.
"The average clearance price of Tesla is 438 US Dollar. The 30 million US Dollar we originally invested has now become..."
She paused and reported the number:
"61.5 million US Dollar. The principal is doubled, and the net profit is 31.5 million US Dollar."
Zhao Chen took the report and scanned the rows of precise numbers.
The average buying price was 215 US Dollar, held for half a year, and the average selling price was 438 US Dollar - a rate of return close to 104%.
"When can the funds be transferred back?" he asked.
"Cross-border clearing takes time, but it will be available in the Hong Kong account tomorrow afternoon at the latest."
Chen Xi said, "About 480 million Hong Kong Dollar."
Zhao Chen breathed a sigh of relief and leaned back on the chair.
The arrival of this money means that his Cash Reserves is getting richer again.
He will have more confidence to face any variables that may arise next.
"Call Wantang and Qingxue over." He said, "There is something I want to discuss."
Five minutes later, the Westerners were sitting around on the sofa in the office.
Su Wantang brought the freshly brewed coffee, and the aroma filled the air.
Zhang Qingxue opens the notebook and prepares to record.
Chen Xi has set up the projection equipment.
"During dinner last night, Xiaowen mentioned the increase in pork prices, which reminded me of an investment direction."
Zhao Chen got straight to the point, "I judge that pork prices will remain at a high level in the next two to three years."
He gestured to Chen Xi to call up the data:
"In the first half of this year, pork prices have increased by 18%.
There are multiple factors behind it, such as rising feed costs, tightening environmental policies, and the withdrawal of retail investors. But I think the real catalyst has not yet come."
All three ladies looked up.
"So here's the thing," Zhao Chen continued,
"If we want to participate in this trend, which way should we choose? Build our own pig farm, or invest in related Listed Company stocks?"
He looked at Chen Xi: "First tell everyone about the information collected last night."
"According to Zhao Zong's request last night, I focused on the two leading brands Muyuan Shares and Wens Shares."
Chen Xi Switch PPT,
"They represent the two core modes of China Live Pigs breeding, each with its own advantages and disadvantages."
"First, let's take a look at Muyuan Model - self-propagating and self-supporting integration."
She called up the data chart of Muyuan:
"Muyuan follows an asset-heavy model of 'self-breeding and self-supporting'. From pig breeding, feed processing, Live Pigs breeding to slaughtering and processing, we control everything ourselves."
"Its advantages are outstanding:
1. Strong quality control capabilities.
The whole process is controllable, the risk of disease is low, and the quality of the meat is stable.
2. Cost control advantages.
Large-scale, standardized breeding, high feed conversion rate, and last year's total cost was 15% lower than the industry average.
3. Deep data accumulation.
More than ten years of breeding data have formed core competitiveness."
Chen Xi paused to give everyone time to digest, "At the same time, its shortcomings cannot be ignored:
1. Capital expenditure is huge.
The investment in production capacity is about 15 million yuan per 10,000 heads, and the expansion speed is limited by funds.
2. High management complexity.
It requires a large professional team and the management radius is limited.
3. High asset-liability ratio.
Continued expansion has resulted in the debt ratio remaining above 60% for a long period of time."
"The above are the advantages and disadvantages of Muyuan Model. Next, let's take a look at the Wens model - company + farmers."
"Wens is taking the asset-light route."
Chen Xi Switch page,
"The company is responsible for breeding pigs, feed, technical services and sales, and farmers are responsible for breeding.
Wens provides piglets, feed, and veterinary drugs, and finally recovers the finished pigs at the agreed price."
"The advantages of this model are as follows:
1. Rapid expansion.
There is no need to build a large number of pig houses, and farmers' resources can be quickly integrated.
2. Little financial pressure.
The investment in fixed assets is small and the cash flow is relatively healthy.
3. Spread the risk of disease.
Farmers doing scattered farming are not as likely to be wiped out as concentrated farming."
"Of course, the shortcomings are also obvious:
1. Quality control is difficult.
The management level of farmers is uneven, and there are many hidden dangers to food safety.
2. Profit margins are compressed.
It is necessary to transfer profits to farmers, and the total cost is 10%-15% higher than Muyuan.
3. The cooperative relationship is unstable.
When pig prices are high, farmers may sell privately, and when pig prices are low, they may exit.
Chen Xi concluded:
"At present, the capital market prefers Muyuan Model, believing that its long-term competitiveness and risk resistance are stronger.
Therefore, the P/E ratio of Muyuan is as high as 35 times, while that of Wens is only 22 times.
But this also means that if we invest in Muyuan now, we will pay a higher premium."
Zhao Chen thoughtfully said, "If we build it ourselves, which model should we learn?"
Zhang Qingxue spoke first:
"If you build it yourself, I recommend referring to Muyuan Model.
Although the initial investment is large, quality control capabilities are more important in the long run.
Food safety is the bottom line, if something goes wrong, the brand will be ruined."
She wrote a few words on the whiteboard: environmental protection approval, land use, vaccine prevention and control regulations.
Then, she pointed to the environmental protection approval. "However, we have to face many problems."
Then, she raised the issue from a professional perspective, "The first issue we face is environmental protection approval.
A 10,000-head pig farm requires an environmental impact assessment and a pollution discharge permit, and the process takes at least 6-8 months."
"The second thing is land use.