Despite being a growing reservoir of funds under management, this critically important pool of capital is confronting mounting problems collating and disseminating key data in a timely manner.
The ratings house is pinning its growth strategy on a revamped methodology that increases the emphasis on governance to 25 per cent – a timely move considering APRA’s proposed reforms.
China Dairy delivers 25% ‘stag’ profit
(pictured: Len McDowall and Enjia Liu)
China Dairy Corporation handed investors a 25 per cent day-one potential profit when, last Friday, it became the 18th company to list on the ASX so far this year, having successfully raised $17 million.
The company is looking to garner Australian dairy technology to aid its big milk-producing operation in northern China. It is also developing a Mongolia-based R&D facility as a strategic focus of innovation, with safe and efficient milk production for infants a high priority.
China Dairy, which was established in 2005, has more than 40,000 cows with an average raw milk capacity of more than 600 tonnes a day. The company had total revenue of A$79.1 million in 2015
An interesting aspect of its business model is that it expanded beyond breeding company-raised cows to outsourcing cattle-raising to local farmers – in the historically poorer north – allowing the wholesaling of raw milk.
The lead advisor to the IPO was Sydney-based BlueMount Capital which believes the strong response to the IPO reflects the positive long-term fundamentals for the dairy industry, driven by Chinese consumers’ growing demand for quality food products.
Len McDowall, a BlueMount director, said that Chinese companies saw an ASX listing as a big benefit to their image because of Australia’s strong legal and governance systems. He was hopeful of assisting other Chinese-based companies to list here, having set up representative offices in Beijing, Shanghai and Hong Kong. BlueMount has helped list several Chinese and other foreign companies to list in the past two years.
Enjia Liu, China Dairy’s chairman, rang the bell on Friday at the traditional ASX listing ceremony, for a bevy of Chinese and Australian supporters.
Note: Investor Strategy News and sister publication New Investor actively promoted the IPO through advertising and direct marketing.
