Source: Tai Kung Pao
Hong Kong stocks have adjusted extremely rapidly over the past week. Recently, they hit a new low during the year, close to the 16,000 point level, while the Hang Seng Index has recovered to the gap in November last year. Since many index constituent stocks have reached 52-week lows, short-term weakness is obvious, so it is better to wait and see when it stabilizes.
Jiayao Holdings (01626) is a paper cigarette packaging supplier in China. It has been deeply involved in the traditional tobacco industry for nearly 30 years. It has successfully entered the new tobacco industry in recent years. It is committed to providing excellent tobacco packaging products and new tobacco products, and expanding diversified profit models. Since the state established the “e-cigarette management measures” in March 2022, the national standards for e-cigarette products and the technical review system have been clarified, and the development prospects of the industry have become clear.
Furthermore, many countries or regions around the world have agreed on laws, regulations, and standard requirements for e-cigarette products, etc., and policy risks have been reduced relatively.
New types of tobacco have achieved a relatively rapid growth rate in recent years. Among them, the electronic atomization market will have a compound annual growth rate of 30.6%. Jiayao has mature technical reserves in the e-cigarette industry. It has a research institute that focuses on developing harmful nicotine alternatives based on atomized e-cigarette products.
Novel tobacco ingredients contribute half of net profit
In fact, Jiayao has a full industry chain of atomized e-cigarette products, HNB health products, etc. to meet the preferences and needs of different customers, while its battery supply chain has a complete production management system and quality control system. Most products have passed many professional certifications such as CQC, CB, UL, CE, PSE, KC, UN38.3, and ROHS.
After a few years of transformation, Jia Yao is now entering a harvest period in the new tobacco business. The 2022 interim results began with a clear increase in gross profit. This year's interim performance growth accelerated, and the new tobacco business sector has become an important driving force for the overall performance of Jiayao.
Some markets estimate that new types of tobacco will contribute half of the company's net profit for the full year of 2023. It can be seen how the company is developing.