TECON(SZ:002100) Zheng Quan Shi Bao Wang·2025-12-15 03:04Core Viewpoint - TianKang Biological's acquisition of a 51% stake in Qiangdu Livestock is a strategic move to strengthen its position in the pig farming industry amid ongoing challenges, showcasing a proactive approach to industry cycles and cost management [1][2][4]. Group 1: Acquisition Details - TianKang Biological announced a cash acquisition of 1.275 billion yuan for 51% of Qiangdu Livestock, which will become a subsidiary post-transaction [1]. - Qiangdu Livestock is projected to produce 1.36 million pigs in 2024 and over 1.5 million in 2025, maintaining profitability since 2020 despite industry losses [2]. - The performance commitment for the acquisition includes a cumulative net profit of no less than 837 million yuan over the years 2025, 2026, and 2027, with cash compensation for any shortfall [2]. Group 2: Industry Context - The pig farming industry is currently in a deep adjustment phase, with self-breeding and purchased pig farming profits reported at -167.69 yuan and -259.39 yuan per head, respectively [2]. - Many companies are retracting, while TianKang Biological is expanding through strategic acquisitions, indicating confidence in its operational strategy [2][6]. Group 3: Competitive Advantages - Qiangdu Livestock has over a decade of experience in pig farming in Southern Xinjiang, with strong cost competitiveness and effective production management [3]. - The acquisition aligns with TianKang Biological's strategy of creating a complete industry chain, integrating feed, vaccines, breeding, and slaughtering, enhancing operational synergies [3][4]. - TianKang Biological's robust financial health, with a cash flow of 2.351 billion yuan and a low debt ratio of 47.86%, supports its expansion strategy [4][6]. Group 4: Strategic Implications - The acquisition is expected to enhance TianKang Biological's overall strength and competitiveness by leveraging its resources in feed technology and animal health [4]. - The company's approach to counter-cyclical investment is seen as a model for high-quality development in the livestock industry, emphasizing the importance of technology and industry chain integration [6].