Never mind the limp stock price performance of Sino Grandness.
From 2H2017, its business could be energised by the injection of a potential star product to its range, which is now dominated by loquat beverages.
Yesterday, the company said its senior management and that of PM Group attended a signing ceremony on 6 January 2017 in Bangkok "to reaffirm each other’s commitment" on the exclusive distribution of "P80 Longan Essence" by Sino Grandness in China and Hong Kong.
PM Group and a related party in aggregate hold a 13.91% stake in Sino Grandness.
The exclusive rights shall be effective for 20 years ending on 31 August 2037. The committed sales target is 2 million bottles of P80 Longan Essence in the first year and increasing thereafter.
P80 Longan Essence sounds like some wonder functional food, going by its description in Sino Grandness' press release.
No retail price was mentioned but Sino Grandness is to buy it at 400 baht (about S$16) per bottle, according to an earlier announcement.
It is likely to be somewhat affordable to the masses. The press release refers to it being available, among others, in a "ready-to-drink 60 ml bottle for mass market".
If management is reading this, we suggest that it bring bottles for sale -- or better still, free tasting -- in future AGMs and results briefings.
Sino Grandness could also bring samples, if available, to the EGM that it will convene to seek specific approval of independent shareholders for it to proceed with this P80 Longan Essence business.
The shareholder approval is required given that the first-year purchase of the product by Sino Grandness will exceed 5% of its NTA as of FY15.
The story in a nutshell:
P80 Longan Essence:
• Developed by Chiang Mai University’s Faculty of Agro-Industry and endorsed by the Faculties of Medicine, Pharmacy and Food Science.
• More than 10 years of R&D on the proprietary patent-pending extraction process.
• Result: A super antioxidant and high vitamin C product.
• Based on focus group studies and market research, P80 Longan Essence has shown various health benefits including better sleep quality, normalizing blood pressure. invigorated vitality and long lasting stamina.
|"The P80 Longan Essence has superior health functions compared to other health products and beverages in the market as it will deliver noticeable health benefits within a few days of consumption."
-- Prayudh Mahagitsiri (photo), Chairman of PM Group
a. Gift pack comprising 2 bottles of 240ml P80 Longan Essence
b. Premium pack comprising 1 bottle of 240ml P80 Longan Essence
c. Ready-to-drink 60 ml bottle for mass market
d. Sachet pack (15ml size)
"Given the proper sales and marketing strategies, I believe P80 Longan Essence can grow to become another growth driver within the ever expanding product range of Sino Grandness."-- Huang Yupeng (photo), CEO, Sino Grandness
"We are excited about the global prospects of P80 Natural Essence once we commence mass production in Thailand from the second half of 2017.
"We have no doubt that the P80 Natural Essence will be a big success for Sino Grandness.”
Joseph Chia (photo), director of marketing for P80 Natural Essence. He is also Senior Executive Vice President at PM Group.
(Source, 26 Oct 2016)