Originally Posted by
MAC
Either way ATM are happily growing revenues at 45% p.a without any infant formula sales in China.
It is easy to forget that China has not got an open democratic government and bureaucracy and it does seem from recent media commentary that the regime there may intend to generally knock the quality and therefore price of imported infant product. The latest Fonterra news may probably provide some further fodder for this aim.
It would be interesting to hear from posters with a ‘having lived in China’ perspective as to what the retail market perceptions on the ground are really like. Would A2 as the brand with the greatest premium health benefits have greater traction over its competitors in such an environment, or, is the market booming to the point where all infant formula brands are simply just golden ?.
ATM are well diversified across other markets and infant formula sales don’t commence in China until next month. Thus there can be not much short term impact, longer term I don’t see the Chinese market getting smaller for NZ brands, in fact it is estimated to double by 2016.