The chairman of the board was interviewed, and Muyuan shares earned 80 million yuan a day for...

The turmoil of "questioned performance fraud" has not yet subsided.
In the first quarter, Muyuan, whose net profit soared nearly 70% year-on-year and average daily income of about 80 million yuan, intends to issue 9.
5 billion yuan in convertible bonds
.

This move not only caused "suspicion" from the outside world, but also caused its chairman Qin Yinglin to be interviewed by the China Securities Regulatory Commission

The chairman was interviewed for issuing bonds against the wind

The recent Makihara shares have not yet settled, but they have risen again
.

In early March, a well-known investor issued a document questioning Muyuan’s performance fraud, which attracted inquiries from the Shenzhen Stock Exchange

Within two days of the quiet days, Muyuan asked the China Securities Regulatory Commission to issue convertible corporate bonds with a total face value of 9.
55 billion yuan to the public for a period of six years
.

Muyuan said that the company will select an opportunity to start the issuance of convertible bonds after the 2020 profit distribution plan is implemented

According to the announcement, the China Securities Regulatory Commission found that Muyuan had violated Article 48 of the "Measures for the Administration of Securities Issuance of Listed Companies" and decided to take supervisory talks with its chairman, Qin Yinglin, and required Qin Yinglin to bring a valid ID to the China Securities Regulatory Commission on May 11 Will accept supervisory talks
.

The China Securities Regulatory Commission stated that if a major event occurs before the issuance of securities by a listed company, the issuance should be postponed and the China Securities Regulatory Commission should be reported in a timely manner

Earn 80 million yuan a day, "not bad money"

Is Muyuan lack of money? In the first quarter of this year, when the net profit of competitors such as New Hope, Wen's, Zhengbang Technology, and Tianbang shares fell sharply, the net profit of Muyuan shares soared by about 70%, achieving a net profit of 6.
7 billion to 7.
3 billion yuan, with an average daily income.
About 80 million yuan
.

According to the 2020 performance report, Muyuan’s revenue last year was 56.

Why is it not short of money to repay the debt? The relevant person in charge of Muyuan said at the performance briefing that as the company's production and operation scale continues to expand, it is necessary to obtain capital investment that matches its scale
.

The company combines market conditions and operational needs, fully explores its potential, actively explores multi-channel financing models, and selects appropriate and effective financial tools to support the company's normal development and operation

An investor who participated in the survey of Muyuan shares held on May 12 told the China Business Daily that the 9.
5 billion yuan convertible bond that Muyuan intends to issue this time was originally planned to be issued at the end of March.
"The storm had been planned before
.

When the China Securities Regulatory Commission examined and approved Muyuan's bond issuance application, it was discovered that this issue had not been resolved, so it had this interview with the chairman of Muyuan

Muyuan shares this issue of convertible bonds or is to expand the pig farm, to seize more market share
.

The above-mentioned investors said, "Muyuan shares' model is self-reproduction and self-support, without the participation of individual farmers.

Why venture to expand

For some breeding companies and retail investors, under the current live pig prices, expansion may mean expanding losses
.
Wang Yanan, an analyst at Zhuochuang Information, told reporters that since May, the average profit of self-raising pigs has fallen by more than 40%; while piglet fattening has already suffered a loss, the profit of a commercial pig has fallen by 472.
92 yuan
.
The current price of live pigs has touched the psychological defense of farmers, but the fat pigs on the market have not yet been digested, and the price of live pigs may still decline after a short period of price increases
.

Muyuan shares also acknowledged that the price of live pigs is expected to bottom out for some time to come
.
The relevant person in charge of Muyuan said that for the industry, the price of live pigs in 2022 and 2023 may have a bottom, and the company needs to prepare for the low price in 2022
.

The raising of funds and construction projects may be the preparations made by Muyuan before the pig price bottoms out
.
An industry insider who has been observing the pig breeding industry for a long time told reporters that the current decline in pig prices is the result of a multi-party game, not the true performance after the supply and demand are balanced
.
On the one hand, the market is pessimistic about prices, and the breeding end is actively selling fat pigs, causing prices to fall; on the other hand, it is more difficult for slaughter companies to purchase live pigs, and they are also taking advantage of the opportunity to lower prices
.
Judging from the cost line announced by the listed pig companies, most of them are still aiming at the profit space and actively expanding, which shows that there is still a shortage of pigs in the market
.
For leading companies, spending more capital on expanding production capacity is still the main task at present.
Even if there is overcapacity in the later period, the market will take the lead in eliminating small-scale and poor-capacity companies
.

The relevant staff of Muyuan said that the construction in the first three or four months of 2021 is still relatively intensive.
The company currently has a land bank with a total production capacity of close to 100 million heads.
The current goal is to achieve high-quality production capacity, improve production efficiency, and reduce production capacity.
Production costs
.
The confidence of Muyuan's expansion may also come from its cost advantage
.
The total cost of Muyuan shares in the first quarter was about 16 yuan/kg, which is already ahead of competitors in the same industry
.
Muyuan plans to reduce the cost to about 11 yuan/kg.
The relevant person in charge of Muyuan said that the current price of live pigs is 18-20 yuan/kg.
Next year, the price of pigs is expected to be as low as 15-16 yuan/kg, which is unlikely.
There is a situation of 10-12 yuan/kg
.