Hong Kong stock detergent first share

Founded by Luo Qiuping in 1992, Blue Moon is the leading provider of household cleaning solutions with consumers as the core and innovation as the driving force, and is also one of the earliest professional brands engaged in the production of household cleaners in China.

Blue Moon's revenue is mainly composed of three parts. In the six months ended June 30, 2020, the highest proportion of clothing cleaning products was about 69%, while that of personal cleaning care products and household cleaning care products was about 19.1% and 11.9% respectively.

Blue Moon first launched laundry detergent in the domestic market in 2008, ranked first in domestic detergent market share for 11 consecutive years since 2009, and ranked first in domestic hand sanitizer market share for 8 consecutive years since 2012. By the end of 2019, Blue Moon had the first market share in terms of retail sales in the mainland detergent market, concentrated detergent market and hand sanitizer market.

Ranked according to China Brand strength IndexThe company ranked first in the detergent market and hand sanitizer market for ten consecutive years (2011-2020), and there was a big gap between the C-BPI score and the second place

Net profit exceeds 1 billion Hong Kong dollars, ROE exceeds Maotai

Blue Moon's operating income in 2017, 2018 and 2019 was HK $56.32,67.68 and HK $7.05 billion respectively, up 20.2% and 4.2% year-on-year in 2018 and 2019, respectively, with a three-year compound growth rate of 11.9%.

In 2019, Blue Moon recorded a gross profit of HK $4.523 billion, up 16.39 per cent from a year earlier; gross profit margin rose 6.8 per cent year-on-year to 64.2 per cent.In 2019, Blue Moon recorded a net profit of HK $1.08 billion, an increase of 94.9% over the same period last year, and a net interest rate of 15.3%, an increase of 7.1% over the same period last year.

It is worth pointing out,Blue Moon's ROE in 2019 is as high as 45.7%(return on equity equal to net profit divided by the average of total equity at the beginning and end of the period multiplied by 100%)It exceeds the "stock king" Maotai's ROE 33.12% in 2019 under the same calculation caliber, and also exceeds NONGFU SPRING CO., LTD. 's ROE in 2019 by 39.37%.

Prospects for the future

The total retail sales value of China's household cleaning care industry increased from 90 billion yuan in 2015 to 110.8 billion yuan in 2019, with a compound annual growth rate of 5.3 per cent, which is higher than the 2.5 per cent compound annual growth rate of the global home cleaning care industry in the same period.

The total retail sales value of household cleaning care industry in China is expected to continue to grow.It will reach 167.7 billion yuan by 2024, with a compound annual growth rate of 8.7% from 2019 to 2024.

From the perspective of industry trend, household cleaning has an obvious trend of "liquefaction".Take detergent as an example, the retail sales value of detergent grew rapidly at a compound annual growth rate of 13.1 per cent from 2015 to 2019 and reached 27.2 billion yuan in 2019, while the retail sales value of laundry detergent declined at a compound annual rate of 0.6 per cent during this period.The total value of retail sales of laundry detergent is expected to grow at a compound annual growth rate of 13.6% from 2019 to 51.5 billion yuan by 2024.

The simple summary is thatAs a leading brand in the industry, Blue Moon can not only enjoy the dividend of the development of the industry, but also seize the market share of competitors'"washing powder" (just like trams grabbing the market share of oil cars).

Hillhouse has held heavy positions for 10 years.

According to the prospectus, Hillhouse Capital has a 10% stake in Blue Moon and is Blue Moon's largest outside investor. As early as 2010, Hillhouse invested $45 million in Blue Moon's Angel Wheel, becoming Blue Moon's only outside investor at the time, and invested an additional $1.03 million in 2011.

Zhang Lei, founder and CEO of Hillhouse Capital, once said publicly that Hillhouse, which studied consumer upgrading in 2008, found that multinationals Procter & Gamble Co and Unilever occupied the household washing market, but the essentially historical burden of these multinationals prevented them from grasping the trend of consumer upgrading, which brought opportunities for the local brand Blue Moon.