Fengxiang shares (09977.HK) equity incentives were released: "locking" key talents and passing on long-term growth confidence

On December 10, Fengxiang Co., Ltd. (09977.HK), the parent company of the new consumer brand Youxiang and the first chicken consumption company listed on the Hong Kong stock market, issued its first equity incentive announcement since its listing, intending to transform 63 employees into "partners" of the company through repurchase and grant, demonstrating long-term development confidence.

On the first trading day after the announcement, Fengxiang shares rose sharply, reaching HK$1.76/share intraday, an increase of nearly 8%; as of the close, it was quoted at HK$1.73/share, with a total market value of about HK$2.4 billion.

(Source: Wind)

The entire new consumer market is also undergoing cognitive upgrading from traffic thinking to the whole industry chain, who can reach more consumers and forge a better supply chain... Who can guarantee innovation and form a long-term competitive advantage. Fengxiang co., Ltd. was originally a leading "fully integrated white feather chicken producer", and its supply chain advantages and values that have been built over time may become more and more apparent in the competition after the new consumption day, and the issuance of equity incentive announcements at this time is undoubtedly of great significance.

Large-scale equity incentives "lock" key talents and strive to maximize value

Specifically, according to the announcement, Fengxiang shares will purchase a total of 26.0976 million shares in the open market, and grant 23.4878 million shares to 63 elected employees, accounting for about 6.62% of the total number of issued H shares and about 1.68% of the total issued share capital of Fengxiang shares (announcement date), with a large incentive; of which 2.6098 million shares are temporarily deposited into the trust fund pool as a reserve for future awards.

Generally speaking, in addition to commending the contributions of core employees, equity incentives can deeply bind the interests of key talents with the interests of the company, enhance their sense of responsibility and mission for the company by forming a value community of "focusing on the future, sharing benefits and sharing risks", and more thoroughly motivate them to work for the long-term development of the company. Specifically, it is manifested in improving work efficiency, team cohesion, consciously reducing various costs, enhancing the company's market competition and sustainable development capabilities, and ultimately helping to recover the long-term value of the industry.

To some extent, equity incentives are gradually becoming a must for the development of enterprises. Both mega-companies and small and medium-sized players are working along this path. According to incomplete market statistics, in the past November alone, more than 80 companies in the A-share market have their equity incentive plans approved by shareholders' meetings.

With the promotion and penetration of the equity incentive plan, it is bound to help Fengxiang form a closer relationship with key talents, as well as lay a good foundation for it to continue to absorb other senior talents in the future, thereby promoting its continuous development and maximizing the value of the company and shareholders.

The supply chain lays the foundation for development, and the performance elasticity may be further released

And what does greater value mean for Fengxiang shares? Or what is the long-term value of Fengxiang shares? Ultimately, these issues have to focus on the business.

Let's look at the status quo first. Fengxiang Co., Ltd. was born in 2016, as a "new species" in the industry, it has created a category of healthy instant chicken breast in China, and has continuously expanded its category boundaries, developing a variety of innovative products such as protein bars, a mouthful of unbearable intestines, and non-fried pie, based on happy fat loss doctrine, providing young people with low-burden body solutions.

At the same time, in addition to product functions, Shape is also very good at responding to the emotional needs of consumers on the marketing content side, and can quickly become a representative of new consumer brands. For example, as the first meat brand, he appeared in "The Color Run, the happiest 5 km run on earth", conveying the life concept of "the more shaped, the more wanton"; in the next rice variety show "Longing For Life", he interpreted the life proposition of "living a longing life with a longing body". In July 2021, at the top IP "Taobao Maker Festival", U-Shape debuted as the C-bit of "Chief Treasure Brand"; in August of the same year, it deeply participated in the Douyin 818 New Wave Good Things Festival as the exclusive partner of the industry.

More intuitively, in terms of actual sales, as of March 2021, the cumulative sales of premium ready-to-eat chicken breast products have officially exceeded 100 million packs. In the first half of 2021, U-Shape achieved sales revenue of 238 million yuan, an increase of 195.0% year-on-year, of which online revenue growth rate reached 247.4%; in the third quarter, U-Shape's online and offline revenue was 149 million yuan, an increase of 124.6% year-on-year.

In terms of future trends, as mentioned in the opening paragraph, the entire new consumer market is undergoing cognitive upgrading from traffic thinking to the whole industry chain. With the iteration of the main force of young consumption and the rapid development of the Internet, the channel dividend has gradually decreased, superimposed consumers have paid more and more attention to quality consumption, the degree of demand segmentation has become higher and higher, and enterprises and brands have gradually returned to the "people-oriented" competition model.

To do this, to match the innovation and change of the main force of young consumers, it is necessary to deeply cultivate the supply chain and industrial chain. Players with strong supply chain capabilities can reduce cost pressure, ensure supply efficiency and innovation in all aspects of the supply chain, and further open up the space for brand "premium", which plays an important role in steady operation, cost reduction and efficiency improvement. At the same time, the construction of mature supply chains is often long, and existing players with strong supply chain capabilities are often prone to deep moats.

Fengxiang Co., Ltd. has entered the C-end business from the leading "fully integrated white feather chicken manufacturer", and has earlier opened up the upstream and downstream supply chains, used big data, AI and other artificial intelligence to empower supply chain management, and established a "Tokyo + Shanghai + Shandong" three-place R & D system.

Obviously, it is difficult for new consumer brands to compare with them, which also shows that Fengxiang shares have outstanding advantages in the future competition of the healthy instant food subdivision track. After the equity incentive, its interests are deeply bound to the interests of key talents, and the foundation for achieving strategic goals is more solid, and there is a better opportunity to recover the long-term value of the industry and transform it into a sustained performance driver.

This article originated from Grand Gateway