Recently, hundreds of billions of “pig grass” Muyuan Foods Co.Ltd(002714) has been at the forefront of public opinion for many times. First, 32 subsidiaries of the company were overdue in payment, and then suffered a downgrade of rating outlook, which was repeatedly called “thunder”. On the afternoon of December 22, Qin Yinglin, chairman of Muyuan Foods Co.Ltd(002714) said that it was normal to have doubts and had taken a variety of measures to deal with the current financial problems and cash flow problems at the extraordinary general meeting.
For listed companies, it is only natural to actively respond to investors’ questions. The response of Muyuan Foods Co.Ltd(002714) aims to give the market more confidence. Of course, A-Shares also responded quickly, rising 4.31% on December 23. But this also made some investors feel uncomfortable and thought that Muyuan Foods Co.Ltd(002714) did not respond positively to the query.
The growth curve of Muyuan Foods Co.Ltd(002714) can be called perfect. With advanced breeding technology, low-cost advantages and high growth, it has been successfully listed and ranked among the leading pig breeding enterprises in China. However, in recent years, it has frequently faced cash flow and financial questions, and is suspected of data fraud.
On the one hand, the commercial bill was not cashed within the time limit, which questioned the debt repayment pressure of Muyuan Foods Co.Ltd(002714) . From August to November this year, 32 subsidiaries of Muyuan Foods Co.Ltd(002714) were overdue in payment, totaling RMB 45.1853 million. Although Muyuan Foods Co.Ltd(002714) explained that it was not cashed in time because it did not receive the payment application of some holders in time and the clearing method selected by the holders did not meet the bank’s requirements, and disclosed that “the monetary capital balance of the company was RMB 9.95 billion by the end of September 2021”, However, many investors do not buy it. Some people directly said: “performance can be fake, but commercial tickets can not be fake. Whether there is money in the account, pull it out for a walk”.
On the other hand, investors have repeatedly questioned the authenticity of Muyuan Foods Co.Ltd(002714) financial data. As early as March this year, a financial blogger questioned a number of financial data of Muyuan Foods Co.Ltd(002714) and attracted regulatory inquiries. Qin Yinglin was interviewed by the CSRC. On November 26, another head brokerage analyst “kindly reminded” the group of friends to pay attention to risks, saying that Muyuan Foods Co.Ltd(002714) “involves the risk of financial fraud, which should explode soon”. Of course, the market is not polite. The share price of Muyuan Foods Co.Ltd(002714) once fell sharply, and the market value evaporated more than 10 billion yuan.
In this process, although Muyuan Foods Co.Ltd(002714) has tried to respond to these questions for many times, it has little effect, mainly because it has not effectively dispelled the concerns of investors.
Of course, investors’ concerns are not groundless:
First, the performance continued to decline due to the continuous decline of pig prices and rising feeding costs. In the third quarter of this year, Muyuan Foods Co.Ltd(002714) net profit was -822 million yuan, a year-on-year decrease of 108.05%. Second, the capital chain is tight due to the accelerating pace of layout and the continuous expansion of investment scale. Since this year, Muyuan Foods Co.Ltd(002714) has obtained more than 15 billion yuan through fixed increase fund-raising and issuance of convertible bonds. It can be seen that the current solvency is indeed weak. Third, the gross profit margin of pig raising is much higher than that of peers, which is also one of the most controversial issues of Muyuan Foods Co.Ltd(002714) . In the first half of 2020, the gross profit margin of Muyuan Foods Co.Ltd(002714) pig business was 63.27%, while the gross profit margins of Tech-Bank Food Co.Ltd(002124) , New Hope Liuhe Co.Ltd(000876) , Wens Foodstuff Group Co.Ltd(300498) and Jiangxi Zhengbang Technology Co.Ltd(002157) pig raising enterprises, which are also China’s leading pig enterprises, were 54.06%, 42.6%, 38.39% and 35.72% respectively.
For any listed company, it is normal to have doubts as long as it is not deliberately discredited, but it is not normal to be questioned repeatedly but can not really respond to the concerns of investors. At a small scale, it may be that the enterprise’s public relations response ability is insufficient. At a large scale, it may also be that the enterprise data are different. Because, from the perspective of investors, there must be something strange about concealment.
Let investors clear their doubts, Muyuan Foods Co.Ltd(002714) simple response alone is not enough. We should not only respond to queries in an all-round and targeted way, but also disclose more data worthy of study, but also effectively tap the endogenous driving force of more enterprise value growth from the perspective of deepening science and technology and innovation management. Of course, the timely, deep and continuous intervention of the securities regulatory department can also reduce the possibility of malignant events. It should also be pointed out that when listed companies are frequently questioned, investors should keep rational and thinking to avoid more risks.
(Daily Economic News)
