265 million RMB spent! Selling well in Southeast Asia

Big sellers are really willing to spend money to expand their business——

Anker and Huakai Yibai invested billions to build their headquarters in South China. Daotong Technology spent hundreds of millions to build an industrial R&D base in Shenzhen. Lechuang bought land in the United States to build overseas warehouses. Now, there is also a big seller that is going to spend a lot of money to build an industrial base overseas ...

Invest 265 million yuan to implement the project in Vietnam

Not long ago, Hangzhou pet supplies giant Tianyuan Pet announced that it was planning to set up a wholly-owned subsidiary in Vietnam with a registered capital of US$9 million ( approximately RMB 64.12 million ) . The company name is Taiping Yuewang Co., Ltd. (proposed name, the actual company name shall be subject to the actual investment registration certificate/enterprise registration certificate obtained), and the registered address is Biao Township, Qiongfu County, Thai Binh Province, Vietnam.

In terms of business scope, Taiping Yuewang Co., Ltd. produces and sells pet products such as pet cages, pet beds, portable bags, toys, pet leashes, cat litter, etc.; and exercises import rights, import rights and wholesale distribution rights (without establishing wholesale outlets), and retail distribution rights (without establishing retail outlets) for products and goods governed by Vietnamese law.

The registered capital comes from the funds raised by Tianyuan Pet after its listing, and is invested in cash.

Why invest so much money to set up this wholly owned subsidiary?

Tianyuan Pet stated that this was to promote the smooth implementation of the new fundraising project " Tianyuan Pet Vietnam Pet Cage Project " , and the total investment of the project reached 265 million yuan . The remaining amount required for the project will be invested in the form of capital increase or loans using the raised funds, taking into account local specific policies and the actual progress of the project.

Currently, this project is being prepared in an orderly manner and has not been officially implemented. It still needs to go through domestic overseas investment registration or approval procedures, as well as local investment licenses and company registration approval procedures in Vietnam, and there is a certain degree of uncertainty.

Whether it can eventually be implemented and bring more performance boost to Tianyuan Pet still faces the above-mentioned approval risks.

In addition, Vietnam's local laws, policy systems, business environment, cultural environment, etc. are quite different from those in China. The international trade pattern, Vietnam's foreign trade situation, and import and export policies may also change, so there are certain market risks.

However, in recent years, domestic pet companies have been competing to expand into the Southeast Asian market, and Tianyuan Pet is no exception. The reason for landing new projects in Vietnam is not only because the local raw material and labor costs have certain advantages, but also because Vietnam's pet economy continues to explode. According to statistics, the household pet ownership rate in Vietnam exceeds 95%, the highest in Southeast Asia.

This time, Tianyuan Pet went global and invested heavily to establish a business in Vietnam. Earlier, it had spent hundreds of millions to buy land and build factories in China, continuously expanding its business scale.

After buying the land, another 300 million was spent to build an industrial park in Hangzhou

In February last year , Tianyuan Pet announced that based on the company's medium- and long-term strategic development plan and to meet the company's future development needs, it planned to use its own funds of no more than 20 million yuan to acquire approximately 20 acres (specifically 12,940 square meters ) of industrial development land near Xingqiao Street, Linping District, Hangzhou through bidding and auction .

The transferor of the state-owned construction land use rights is the Linping Branch of the Hangzhou Municipal Planning and Natural Resources Bureau. The land transfer period is 50 years, and the starting price and deposit of the bidding will not exceed 18 million yuan.

In March of the same year , Tianyuan Pet announced that if the purchase of the land use rights could be successfully implemented, it would invest in the construction of Tianyuan Pet Industrial Park on the land, creating a pet industrial park with headquarters office, product development, flexible manufacturing of pet apparel and litter pads, online and offline sales of pet products, company e-commerce and information construction, product display and consumer scenario experience and other functions.

The direct investment in the project is estimated to be no more than 300 million yuan (excluding land purchase funds) . Tianyuan Pet will invest its own or self-raised funds in the development and operation of the industrial park project.

In April of the same year , Tianyuan Pet successfully won the land use rights for the project with 17.47 million yuan , and officially signed the "Linping District State-owned Construction Land Use Rights Listing and Bidding Online Transaction Confirmation" with the Linping Branch of the Hangzhou Municipal Planning and Natural Resources Bureau.

Tianyuan Pet later stated that the project will start construction within 6 months from the actual date of land handover , and the development and construction period of the project is expected to be 30 months .

Also in April, Tianyuan Pet signed the "Linping Political Work Project [2023] No. 6 -EPC Engineering General Contracting Contract" with China Power Engineering Group East China Survey and Design Institute Co., Ltd. and China Power Engineering Municipal Construction Group Co., Ltd., stipulating the total calendar days of the construction period: 850 days, and the provisional estimated value of the construction contract (including tax) is 204 million yuan.

After a year and a half, it is understood that the project is still proceeding in an orderly manner.

Sold 2 billion in 9 months

Why is Tianyuan Pet willing to invest huge amounts of money to upgrade the scale of its industry?

The reason may be very simple. In addition to the fact that the pet market dividend is still continuing, the most important thing is that there is money to support its expansion ambitions.

The latest financial report shows that in the third quarter of this year, Tianyuan Pet's revenue reached 782 million yuan, a year-on-year increase of 49.15%, and its net profit reached 23.29 million yuan, a year-on-year increase of 7.62% . As of the end of September, Tianyuan Pet's revenue this year reached 2.035 billion yuan, a year-on-year increase of 33.10%, and its net profit exceeded 54.47 million yuan, a year-on-year increase of 4.34% .

It can be seen that both revenue and net profit of Tianyuan Pet are on the rise.

Although it has actively expanded its pet food sales business in recent years, Tianyuan Pet still focuses on the design, development, production and sales of pet products. Its products cover a wide range of pet products, including pet beds, cat climbing frames, pet food, pet toys, pet clothing, electronic products, etc.

Tianyuan Pet has always attached great importance to overseas markets and sells its own pet products brands on leading cross-border e-commerce platforms such as Amazon.

In 2020 , Tianyuan Pet launched its overseas online B2C business through Amazon. In the same year, overseas online channels contributed 15.1965 million yuan in revenue to Tianyuan Pet, of which 14.8403 million yuan came from Amazon . In 2021 , this channel again brought in 17.4479 million yuan in revenue.

Not only Amazon, Tianyuan Pet also cooperates with large supermarkets such as Walmart, Birgma, KOHNAN, and its products have covered markets such as the United States, the European Union, Australia, and Japan.

From 2019 to 2021, Tianyuan Pet's revenue reached 1.049 billion yuan, 1.45 billion yuan, and 1.854 billion yuan respectively; net profit was 85.78 million yuan, 114 million yuan, and 107 million yuan respectively. During the same period, its overseas revenue accounted for 90.94%, 74.08% and 72.31% of its main revenue respectively.

With its business coverage continuously expanding and deepening , Tianyuan Pet, which has been deeply involved in the pet market for more than 20 years , finally went public in 2022 .

With the funds raised from the listing, Tianyuan Pet has continued to expand its business scale, but at the same time it has not fallen behind in performance.

The financial report shows that from 2022 to the first half of 2024 , Tianyuan Pet's revenue reached 1.887 billion yuan, 2.037 billion yuan, and 1.252 billion yuan, respectively, and the performance in the first three quarters of this year has reached the same level as the whole of last year .

The good performance has provided Tianyuan Pet with a lot of confidence. It can not only vigorously promote the implementation of new projects in Vietnam and open up new markets ; it also stated that it will continue to develop multiple categories of pet products to consolidate its own competitive advantages.

Big Sell

Throwing money