Abstract: As things stand, privatization or the best destination for the golden throat. After delisting, where to go with Jin Si and Jiang Peizhen, time will eventually give the answer.
Text/Takeri
"To protect your throat, please use a golden throat piece, Guangxi golden throat." This slogan was once very popular, making the golden throat treasure product popular all over the country, but with the passage of time, the golden throat has long gone from glory to decline.
On the morning of October 29, the privatization plan released by Golden Throat showed that the relevant shares would be cancelled at HK$2.80 per share through an agreement, a premium of 3.57% compared with the HK$2.70 per share reported on the 28th, and it is expected that the listing status of the shares on the Stock Exchange will be revoked at 9:00 a.m. on December 15, 2021.
Affected by this news, on October 30, the transaction of Golden Throat was extremely sluggish, and the stock price closed at HK$2.69, with a market value of less than HK$2 billion. Since its listing for 6 years, the stock price of Golden Throat has fallen from a maximum of more than 6 yuan to more than 1 yuan, and the market value has shrunk by up to 90%.
Today, it has only been more than 6 years since Golden Throat was listed on July 15, 2015. On that day, the actual controller Jiang Peizhen spread her hands, opened her legs, and with an excited expression on the bell ringing posture, quickly became popular on the Internet.
The 73-year-old female rich man once became a "lao lai"
The predecessor of Golden Throat was Guangxi Liuzhou Candy Factory No. 2. In 1993, Jiang Peizhen, then director of the factory, cooperated with Wang Yaofa, a professor at East China Normal University, to launch the "Golden Throat Throat Treasure" on the basis of the existing throat lozenge products in the factory.
Golden Throat also introduces over-the-counter drugs suitable for relieving acute pharyngitis leading to sore throat and dry throat, that is, Golden Throat Larynx Tablets. This product quickly sold as soon as it was launched. As a token of gratitude, Jiang Peizhen initially printed Wang Yaofa's avatar on the product packaging.
After that, Jiang Peizhen led the leadership team at that time to raise 7.8 million yuan to establish the Guangxi Golden Throat Pharmaceutical Factory. In 1998, Guangxi Golden Throat Pharmaceutical Factory and Candy No. 2 Factory were restructured and merged into Guangxi Golden Throat Co., Ltd., and Jiang Peizhen and her son Zeng Yong became the actual controllers of the company.
In order to further open up the market, Jiang Peizhen fought a battle against the water and boldly took out 5 million yuan to advertise on CCTV. With that magic ad line-up with soccer superstar Ronaldo, successful marketing drove Golden Throat revenue to grow rapidly. In 1996, the revenue of Golden Throat exceeded 100 million yuan and sold well throughout the country.
At the end of the 1990s, the output value of Golden Throat was 200 million yuan, ranking among the top 100 pharmaceutical enterprises in China.
In July 2015, Golden Throat landed on the Hong Kong Stock Exchange. It was also in this year that Jiang Peizhen removed Wang Yaofa's head from the outer packaging of the Golden Throat Treasure and replaced it with her own. In May 2016, the stock price of Golden Throat peaked at HK$7.20 per share, and Jiang Peizhen also entered the ranks of billionaires.
However, the good times were not long, and the rumors of discount placement and other negative rumors caused the stock price of Golden Throat to plummet sharply. The lowest touched HK$0.85 per share, a 90% drop from the high. In addition to the ups and downs of the roller coaster of stock prices, Golden Voice has also been caught in a storm of dishonesty.
According to media reports, in 2016, in order to spread the listing of Golden Throat Herbal Beverage, Golden Throat and Shanghai Canstar Culture Media Co., Ltd. reached an advertising cooperation in "Gai Shi Yinxiong" and "The Masked Singer Season 2". The two sides agreed that the total price of advertising sponsorship for the two programs was 80 million yuan, and the ratings guarantee was also agreed.
Afterwards, the golden voice side believed that the ratings of the two programs were not up to standard and refused to pay the remaining fees.
After several disputes and court battles, on September 19, 2019, due to the failure to pay 51.9498 million yuan as required, the Shanghai No. 1 Intermediate People's Court listed Golden Throat Food as a dishonest executor, and the actual controller Jiang Peizhen was also listed as a restricted consumer, and was restricted from taking planes and staying in hotels above star rating.
What is incomprehensible is that in the face of this result, the two parties to the dispute finally reached a settlement, the Golden Throat party also fulfilled its payment obligations, and the Shanghai No. 1 Intermediate People's Court also issued a judicial document on the termination of the case, but in some media reports, Jin Zi and Jiang Peizhen were still labeled as "Lao Lai" and "has not paid the advertising money in full".
What to do after delisting
In 2015, golden throat was at its peak.
In the year of listing, in the first half of the year, the revenue of Golden Throat was nearly 350 million yuan, and the net profit exceeded 90 million yuan. Six years have passed, according to the company's 2021 semi-annual report, in the first half of this year, it achieved revenue of 370 million yuan and net profit of 81.5 million yuan, returning to pre-epidemic levels.
According to its financial report, Golden Throat has been relying on two products, Golden Throat Throat Treasure and Golden Throat Tablets, which even account for 89% of total sales.
At present, these two products are also facing a sales ceiling, in 2020, the sales revenue of golden throat throat tablets is about 580 million yuan, a year-on-year decrease of 19.3%; the sales revenue of throat treasure series products is about 53.7 million yuan, a year-on-year decrease of 19.6%.
In order to solve the single problem of the product, Golden Throat has also made efforts to diversify, but with little effect. In 2015, Jiang Peizhen said that Golden Throat would take the IPO as a starting point and strive to achieve double breakthroughs in the field of pharmaceuticals and fast moving consumer goods.
In 2016, Golden Throat tested the water beverage market and launched herbal beverages, which are divided into two series, sugar-free and sugar-free, focusing on throat clearing and throat function, focusing on the layout of cinemas, KTV, convenience stores and other channels. Two months after entering the market, sales of 8.4 million yuan have been reached, and it is optimistic that annual sales of the product will reach 350 million yuan.
In order to expand the market with beverage products, Golden Voice has sponsored well-known TV programs such as "Heroes of the World" and "The Masked Singer" to increase exposure. Although the large-scale investment led to a sharp increase in the company's "other products" revenue by 143.2% to 44.5 million yuan in 2016, this income continued to decline, and it was only 9.1 million yuan in 2019.
However, this drink did not bring benefits to Golden Throat, and the performance declined further. The data shows that the launch of herbal beverages, although the company's "other products" revenue increased by 143.2% in 2016 to 44.5 million yuan, but then continued to decline, only 9.1 million yuan by the end of 2019.
Nowadays, the market has found a hard time finding the golden throat herb drink. Launched in July 2019. But sales were few and far between, and it ended in failure.
Shi Lichen, a well-known strategic marketing expert, said that the fundamental problem of Golden Throat is that the product has not been upgraded for a long time, and the corresponding product structure has not been formed. Heavy sales rather than research and development is a taboo for pharmaceutical manufacturing enterprises and even all enterprises. If you do series development on the basis of throat fist products in the past, or if the acquiring company builds up the product structure, you may be able to get out of the current predicament.
As things stand, privatization or the best place for the golden throat. After delisting, where to go with Jin Si and Jiang Peizhen, time will eventually give the answer.
Source: Time Magazine, China News Weekly, 21st Century Business Herald