Shandong Teamgene Technology (SH:603151) Mei Ri Jing Ji Xin Wen·2025-06-17 05:02Core Viewpoint - The company, Bangji Technology, is planning a significant asset restructuring by acquiring 100% equity of six livestock companies and 80% equity of a technology consulting company from Riverstone Farm Pte. Ltd. This move aims to expand from a single pig feed business into the downstream pig farming sector, creating an integrated feed and farming industry chain [1]. Group 1: Company Strategy - The acquisition is seen as a strategic move to address the pressure on Bangji Technology's performance, as the company has faced declining net profits for three consecutive years despite revenue growth in 2024 [1][2]. - By extending into the pig farming business, the company aims to enhance its risk resistance and break through growth bottlenecks, transitioning from merely selling feed to also engaging in pig farming [1][2]. Group 2: Market Context - The feed industry is characterized by limited profit margins and intense price competition, making downstream expansion a viable strategy to optimize product structure and reduce reliance on external markets [2]. - The recovery of the pig farming industry and increasing demand for high-quality pork products present new profit growth opportunities for the company [2]. Group 3: Challenges and Risks - Despite the strategic rationale, the complexity and risks associated with cross-industry integration are significant. The company’s experience in the feed industry does not guarantee effective management of the farming operations [2][3]. - The majority of the acquired companies are located in Shandong, where local policies, environmental standards, land resources, and workforce structure may impact the integration process [2][3]. - The market's reaction to cross-industry mergers can be volatile, and if the company fails to demonstrate improved performance in the short term, maintaining market confidence may become challenging [3].