Black Sesame Transformation: The main product meets the ceiling Li Duoduo wants to withdraw from the new third board

CFP diagram

On November 8, Southern Black Sesame Group Co., Ltd. issued an announcement to revise the responses to Questions 11 and 12 of the Notice of Feedback on the Review of Administrative Licensing Projects issued by the China Securities Regulatory Commission.

In the latest revision of the reply, Black Sesame responded one by one on the realizability of Liduoduo's main business income and net profit this year, the specific development mode of distribution business, the similarities and differences and synergies of B2B and B2C business, the rationality of the rapid year-on-year growth in distribution business forecast revenue this year, as well as the risks faced by Liduoduo in the process of distribution business development and The countermeasures taken by Liduoduo.

At present, Liduoduo is applying to terminate the listing on the New Third Board share transfer system. Zhu Danpeng, a researcher in the food and beverage industry of the China Brand Research Institute, believed in an interview with 21st Century Business Herald that black sesame has been taking the "rejuvenation" strategy in recent years, and the purchase record of young consumers in e-commerce will be relatively high, and the purchase of liduoduo by black sesame is to establish a communication channel with young people.

<h2>Li Duoduo wants to withdraw from the new third board</h2>

According to the data, Founded on March 27, 2012, Liduoduo is a social e-commerce platform with e-commerce distribution services as its main business to provide e-commerce distribution services to brand parties, and operates its own online sales, and was listed on the New Third Board on October 20, 2015, and currently belongs to the innovation layer.

On May 9 this year, Black Sesame disclosed a formal transaction plan to acquire 100% of the equity of Liduoduo for a total price of 700 million yuan, of which 139 million yuan was paid in cash and the remaining 81.5708 million shares were paid. However, half a year ago, the valuation of the majority shareholder Black Five Group when it entered Liduoduo was only 650 million yuan, so shortly after the announcement of the transaction plan, Black Sesame received inquiries from the Shenzhen Stock Exchange and the review opinion of the CSRC.

Black Sesame said in its review reply to the CSRC that the black five types of capital increase Liduoduo is based on optimism about the FMCG e-commerce industry and the recognition of the overall operation of Liduoduo, "After investing in Liduoduo, the understanding of the e-commerce industry has gradually deepened, and at the same time, Liduoduo's performance has grown rapidly in recent years, the development expectations are clear, the business model and various business lines have gradually matured, the ability to integrate resources has been recognized, and the listed companies and Liduoduo have synergy in the industrial chain." Black Sesame revealed that based on the above factors, wei Qingwen, chairman of the company, communicated with Liu Shihong, chairman of Liduoduo, by telephone on December 28 last year to discuss the feasibility of restructuring.

According to the data, in 2015, Liduoduo achieved sales of about 191 million yuan, and the revenue mainly came from fast moving consumer goods such as Mengniu, Southern Black Sesame, Ferrero and Coca-Cola. Last year, it achieved revenue of 597 million yuan, a substantial increase of 2.13 times over 2015. In this regard, Li Duoduo said that the increase in sales scale last year was mainly due to the steady growth of the original FMCG brand sales, as well as the acquisition of Ruokai E-commerce, which obtained the distribution agency right of Bright Milk, and the business scale increased significantly.

The reporter checked the announcement and found that the top ten brands of Liduoduo's main agents are all fast moving consumer goods, including bright milk, Mengniu, Ferrero, Maxwell, Southern Sesame Paste and other well-known food brands at home and abroad. Among the top ten brands of Lidodo last year, Southern Sesame Paste ranked fourth. In the first half of this year, the sales revenue of Southern Sesame Paste was 22.7325 million yuan, accounting for 5.11% of sales.

Wei Qingwen, chairman of Black Sesame, previously said in an interview with 21st Century Business Herald that as the consumption of young people becomes more and more personalized, multi-specification and small batches will become the trend of food in the future, and pointed out that the acquisition of Liduoduo is one of the layouts in line with the overall strategy of the group, "They are also one of our distributors, but they are e-commerce channels." Wei Qingwen said.

Zhu Danpeng analysis believes that in addition to the acquisition of Liduoduo by black sesame, in addition to using Liduoduo's platform to graft its own product sales, it will also use Liduoduo as a platform to promote in the future, so as to obtain income outside the main business, and even build its own platform. "Because there are other FMCG brands in Liduoduo, Black Sesame is like a landlord, and other brands come in to get extra income through its platform."

<h2>Black sesame when the transformation is underway</h2>

Although the southern black sesame, which is mainly engaged in black sesame paste, has always been the big brother of the paste food market, the road of the big brother has become more and more difficult in recent years. According to the financial report, in 2015 and 2016, the sales volume of black sesame paste was 9.0067 million pieces and 6.3791 million pieces, respectively, a year-on-year decrease of 5.39% and 29.17%; the inventory in the same period was 215,500 pieces and 276,600 pieces, an increase of 19.19% and 28.35% year-on-year. The paste products, which are the company's main products, are experiencing ceiling problems.

"The growth potential of the paste market is actually very large, but black sesame will not seize the opportunity." Now young people work, play, and the pace of life is very compact. In the 'small hunger and small hunger' section, there are actually many articles that can be done, to seize the temporary staple food, the staple food of snacks. In Zhu Danpeng's view, the overall operating ability of black sesame is weak, the strategic deployment is not clear enough, and the team's landing ability is relatively poor.

In this latest reply to the CSRC, Black Sesame also disclosed another important information, that is, Liduoduo will take the "new retail" road of combining online and offline and multi-channel coordination.

It is understood that Liduoduo has been mainly based on online B2B business, but will actively explore and carry out B2C business and offline distribution business in the future. In the future, Liduoduo will gradually increase its offline layout, improve the scale of sales and profits through the combination of online and offline, and form a cross-industry, multi-brand and diversified business strategy.

"On the one hand, the original e-commerce channel products are extended to the offline, such as Bright Milk, which are laid out in supermarkets and offline channels; on the other hand, we actively develop new offline brands, such as Shanghai Dashan Hexin Technology Co., Ltd., the leading brand of Chinese mushroom mushrooms, to establish cooperative relations and become its first-class agents in all categories in East China, and add many brands, such as Opple Lighting, Laiyifen, Xinya Food, etc." According to black sesame disclosure, in the first half of the year, Liduoduo achieved revenue of 445 million yuan and net profit of 21.5501 million yuan.

Due to the obvious seasonality of Liduoduo's revenue, and more e-commerce promotional activities in the second half of the year, the proportion of revenue and net profit in the second half of the year is higher, and it is expected that this year Liduoduo will achieve revenue of 1.163 billion yuan and net profit of 59.6501 million yuan. Wei Qingwen said that the group's previous goal of "achieving 10 billion yuan by 2020" is being implemented as planned and is full of confidence in the goal.