Foshan Haitian Flavoring Food Co., Ltd. (Haitian Flavoring) was officially listed on the main board of the Hong Kong Stock Exchange on June 19. On the first day of listing, the H shares of Haitian Flavoring fell below the issuance price.
China’s leading flavoring company, Haitian Flavoring, debuted on the main board of the Hong Kong Stock Exchange on June 19. According to Huaxia Times, on the first day of listing, Haitian Flavoring’s H shares opened more than 3% higher, but later the stock price fluctuated downward and briefly fell below the issuance price. On that day, Haitian Flavoring’s Hong Kong shares closed at HK$36.5 per share, with a total market value of HK$212.5 billion. The same day, Haitian Flavoring’s A shares fell by 3.83%, with a total market value of RMB 225.935 billion.
According to the announcement released by Haitian Flavoring on June 20 regarding the listing and trading of H shares, approximately 279 million H shares were issued this time, of which 55.279 million shares were publicly offered in Hong Kong at a price of HK$36.30 per share, raising about HK$10.01 billion globally.
Haitian Flavoring is a professional flavoring production and marketing enterprise. In early January 2021, its market value once soared to over RMB 700 billion, earning it the nickname “Soy Sauce Maotai” in the market.
In September 2022, reports surfaced online that Haitian Flavoring’s soy sauce sold overseas was free of additives, while the soy sauce sold in China contained additives. This “dual-standard scandal” became a significant turning point for Haitian Flavoring. The crisis of consumer trust led to a sharp decline in its stock price, despite the company’s responses, negative opinions continued to impact its performance. By 2023, Haitian Flavoring experienced the first decline in both revenue and net profit since going public. As of June 19 this year, its A-share price had dropped by over 60% from the peak in January 2021.
In response, Li Yingtao, a partner at Seer Consulting, analyzed to Huaxia Times on June 18: “In recent years, due to the overall weakness of the catering industry, cost reduction has become mainstream for companies. As a mid-to-high-end flavoring brand, Haitian’s penetration in catering procurement is inevitably decreasing.” Furthermore, in terms of household consumption, basic flavoring consumption belongs to a “quantitative market,” making a slowdown in Haitian’s growth inevitable.
Retail industry expert Bao Yuezhong pointed out that there are two major problems in the current food industry: some companies produce products they do not consume themselves but sell to consumers, and consumers repeatedly check ingredient lists when purchasing food, including flavorings, worrying about product safety and usability. He believes that in recent years, these issues exposed in the food industry stem from some food companies abandoning the bottom line they should adhere to and excessively focusing on objectives such as corporate market value growth, reflecting a deviation in the entire industry.