On July 19, Shuanghui development opened low and went low. At one time, it fell 5.46% during the day, and its share price hit a new low of 28.25 yuan / share in the year. As of the midday close, the share price fell 4.89% to 28.42 yuan / share, with the latest total market value of 98.47 billion yuan.
According to the data of K-line chart, on August 31, 2020, the share price of Shuanghui development once rose to a historical high of 63.33 yuan / share, with a total market value of up to 219.4 billion yuan. Subsequently, the share price of Shuanghui development continued to fall. As of the morning of July 19, in less than one year, the share price of Shuanghui development has dropped by 54%, and the total market value has shrunk by about 120 billion yuan.
Public information shows that the main business of Shuanghui development is livestock and poultry slaughtering, processing and sales of meat products and food packaging, and the main products are high-temperature meat products, low-temperature meat products, fresh and frozen products. In particular, its production of “Shuanghui” brand ham sausages, well-known, once made Shuanghui development known as “ham sausages”.
The decline in the share price of Shuanghui development is related to the downward trend of the pig cycle. In the past year, the pig cycle is in the downward stage, and the price of live pigs has been falling frequently.
As of July 19, according to the data of China pig breeding network, the average price of foreign three yuan pig is 15.61 yuan / kg, that of domestic three yuan pig is 15.29 yuan / kg, and that of local hybrid pig is 14.75 yuan / kg.
With the decline of pig price and the rise of feed price, the cost of most breeding enterprises is rising, and the profits of breeding enterprises are falling sharply. New hope expects a loss of 2.95-3.45 billion yuan in the first half of 2021, and Wen’s company expects a loss of 2.26-2.56 billion yuan in the first half of 2021. Even “Zhumao” muyuan company expects its net profit to drop by more than 5%.
Although the core business of Shuanghui development is pig slaughtering and pork deep processing, and the cost will drop when the price of pig falls, in the short term, the pork inventory of Shuanghui development will depreciate.
In addition, the price of live pigs has fallen, and the profits of pig enterprises have fallen sharply, which affects the investment logic of investors. The confidence of the market to long pork stocks may be greatly weakened, and the share prices of several pork stocks have dropped by more than 30% this year. The development of Shuanghui was naturally affected by market sentiment, and the stock price fell sharply.
It is worth noting that with the decline of the share price of Shuanghui development, the “internal struggle” between Bandung, the actual controller of Shuanghui development, and WAN Hongjian, his son, is still fermenting.
According to the Beijing News, in an interview on July 17, Wan Hongjian described the conflict and the reasons for his dismissal. Wan Hongjian said that his suggestions on the company’s development direction and industry choice became the fuse of the incident, leading to the conflict on June 3.
Wan Hongjian further said that on June 3, he came to the Wanlong office to exchange views on the development of the group and the CEO of Wanzhou International, the parent company of Shuanghui development. Then, there was a dispute between the two sides. At that time, Wan Hongjian collapsed, smashed the door with his fist and hit the glass wall cabinet with his head. After that, the bloody man was knocked to the ground by the bodyguards, and Bandung asked for photos to collect evidence.
The conflict between Wan Hongjian and Bandung also led to the removal of Wan Hongjian from the executive director and vice president of Wanzhou International.
On June 17, Wanzhou International announced that after discussion by the board of directors, it has decided to remove the executive director and vice president of wanhongjian group, which will take effect today. The reason given is the recent improper attack on the company’s finance.
article links：Market value of "ham sausage" falls below 100 billion
Reprint indicated source：Shine Trader Limited Live information