"In comparison, the financial aspects of investing in stocks Model are much clearer." Chen Xi nodded and switched the page.
"If Working Capital of our company invests in Muyuan Shares.
In the future, if the price of pork really rises as you judged, the stock price will rise by 100%-150%, and doubling the stock price will not be a problem."
The key data is listed on the ppt she made:
"First, equity investments carry a liquidity premium:
You can sell it for cash at any time without waiting for the construction period.
And then there's the professional premium:
Muyuan's management team is more professional than any team we could have assembled.
The most important thing is the scale premium:
The procurement cost and financing cost of Muyuan are more advantageous than our self-built ones.
"But," Chen Xi changed the topic,
"The problem is also obvious.
First, what we buy is other people's management capabilities, and we can't learn anything ourselves.
Second, if we buy too few shares, we will have no say and will only invest passively.
Third, the price-to-earnings ratio of the entire breeding industry is 28 times, while the price-to-earnings ratio of Muyuan is 35 times, which means that most of the profit growth in the next three years has been overdrawn by the current stock price.
This means we pay 28-35 yuan for every 1 yuan of profit."
Zhang Qingxue Additional legal perspective:
"As Minor Shareholder, we also have to bear the moral hazard of Major Shareholder.
If the management of Muyuan transfers profits through Related Party Transaction, there is nothing we can do.
The income is also one-time. If the stock price rises, we will earn the difference, but it has no synergistic effect on Henglong's main business and has limited impact on the stock price.
If we build it ourselves, all profits will be within our own system."
Zhao Chen looked at Su Wantang and motioned for her to share her opinion.
"I personally prefer stock investment." Su Wantang did not shirk the blame and simply answered,
"This is in line with our consistent asset-light, high-turnover style. And...
With the self-propagating and self-supporting model, it is difficult for us to compete with Muyuan."
After the three of them finished speaking, they all looked at Zhao Chen.
The office was quiet except for the low hum of the air conditioner.
Zhao Chen stood up and walked to the window, looking at the traffic Jiangbeizui downstairs, weighing it quickly in his mind.
Chen Xi is right, investing in stocks is in line with their usual style - light assets, high turnover, and closing when the situation is good.
It also has good liquidity and can be withdrawn at any time if things go wrong.
However, the advantages of building your own farm cannot be ignored.
If the self-built pig farm can be successful, the value will indeed be greater.
It's not just a matter of profit, but more importantly:
First, industrial chain control.
If you can supply your own pork when the price is high, the profit margin will be much larger than simply stock trading.
Second, the capital market story.
Henglong now needs a new growth narrative. If the story of "real estate + farming" can be told well, the valuation may be revalued.
As Chen Xi said, a profit of 100 million can only be given a price-earnings ratio of 10 times in Real Estate Sector, and even a price-earnings ratio of only 3-5 times in the Hong Kong Stocks sector.
But in the story of "consumption + agriculture", it may be 20 times or even 30 times.
Third, strategic depth.
Eggs cannot be put in one basket. When the real estate cycle goes down, agriculture may become a hedge.
But... the risks are indeed high.
No experience, no team, no brand.
We have to start from scratch and grab food on the territory of giants like Muyuan and Wens.
And, this is a long-term commitment.
Once you enter, you cannot exit easily.
Otherwise, the initial investment in factories, equipment, and breeding pigs will become sunk costs.
Zhao Chen turned around and looked at the three people:
"Do you think there is a third way?"
The three of them looked at each other.
Chen Xi was the first to react. "You mean... to take a shareholding? It's not that Secondary Market bought shares, but it was the first to take shares in a medium-sized breeding company?"
"Yes." Zhao Chen walked back to the whiteboard,
"Look for a medium-sized breeding enterprise that has technology and a team, but lacks funds and management experience.
We invest in shares, for example, 30%-40%, without controlling the shares, but assigning directors and Finance Director."
He continued:
"In doing so, we first avoid the risk of starting from scratch and make use of the experience and team of existing companies.
Secondly, the capital requirement is smaller than reconstruction, but larger than simply buying stocks - we need real gold Silver to invest in expansion.
And we will also have a certain amount of Control that can influence decision-making and obtain value from the industry chain.
If you do well, you can increase your holdings or even control the shares in the future. If you don't do well, your losses will be limited.
Zhang Qingxue's eyes lit up:
"This is a good idea. It is neither completely passive Financial Investment nor completely unfamiliar and starting from scratch. And..."
She quickly analyzed:
"If the profits of the companies in which we participate increase significantly during your judgment period, we can recoup the investment through dividends and enjoy the appreciation of the equity at the same time.
If we make a mistake in judgment and the price of pork does not rise, our losses will be limited to the amount of our investment."
Su Wantang nodded. "And our stationed managers can learn the management experience of the breeding industry in practice.
If you really want to enter this industry on a large scale in the future, this group of people will be the seed team."
Chen Xi has started searching on the tablet:
"I immediately screen the eligible targets. Several conditions need to be met:
First, the scale is moderate, with an annual slaughter of 200,000-500,000 head;
Second, the team is professional, but funds are tight;
The third is those who are willing to accept Strategic Investment."