Analysts said that the soaring share price is directly related to the acquisition it just announced. Before the resumption of trading, Lee Group Holdings announced that it would spend HK$ 892.8 million to acquire a 95% stake in New Jiangxia. Li said that the acquisition marks the group's entry into the retail business of department stores and supermarkets, which is in line with its diversified development strategy.
As a regional retailer, Lee's layout is mostly in third-and fourth-tier cities, and the formats involved are more diversified. In the eyes of the industry, although there is room for growth in the third-and fourth-tier markets, high profits are accompanied by high risks. For regional retailers, because of their small scale and poor anti-risk ability, they will be merged or will become their only choice in the case of continuous downturn in the retail industry.
Operation and listing of supermarket business
On March 5, Lee Group Holdings announced the suspension of trading, saying that it would announce the company's major acquisitions and related transactions. That night, it announced the specific acquisition transaction. Yesterday, Lishi's share price rose 23.44% to close at HK$ 0.395.
According to the announcement of Lee Group, it acquired all the rights and interests of Shengxin from Shi Hui, a subsidiary of Li Lixin, the chairman and major shareholder. Shengxin holds 95% of the rights and interests of Xinjiangxia through Shi Feng and Delta (Ningbo) Electric Appliances. It is reported that New Jiangxia was established in 1992, mainly engaged in the retail and wholesale business of 2 department stores and 37 supermarkets in Ningbo. The purchase price was 893 million yuan, of which HK$ 56,543.8+0 million was paid by issuing consideration shares of HK$ 0.3 per share, and HK$ 383 million was paid by issuing consideration convertible bonds of HK$ 0.3 per share.
Li Xuerong, a senior researcher at China Investment Consulting, told me that the listing of the supermarket business by Lee Group is closely related to the company's willingness to build a "business empire". The National Business Daily reporter learned that the main business of Lee Group is to manufacture and trade different clinker and metal daily necessities through its subsidiaries, and entering the commercial field has become another development goal. Starting from 2005, with the wholly-owned acquisition of Ningbo New Jiangxia Co., Ltd. (New Jiangxia) as the starting point, we began to accelerate the transformation from manufacturing to commerce. And adopt the strategy of "fast distribution and chain operation" to seize the third-and fourth-tier cities and the vast rural market.
It is reported that according to different target groups, New Jiangxia is divided into three types of subsidiaries: department stores, supermarket chains and large shopping centers. Among them, the new Jiangxia supermarket is mainly in the rural market. In 20 12, dozens of stores were opened in Ningbo, and the middle and high-end supermarket brand "Lee's Supermarket" was established.
At the same time, Lee also opened a number of large high-end department stores in the name of "Lee's Department Store" in third-and fourth-tier cities such as Tonglu, Haiyan and Xiangshan in Zhejiang. Last year, Lishi turned its attention to the development of Lishi Square, a third-generation urban commercial complex.
Li Xuerong believes that the consumption habits of domestic consumers are changing to individualization, diversification and service, and the segmentation mode of Lishi is defined as different consumption demands, which is reasonable and feasible to some extent and has a bright development prospect. "But insufficient channels and outlets are the shortcomings of the new Jiangxia."
Regional retailers merge or the only choice.
Most of Lishi's retail chain stores are located in third-and fourth-tier cities. In the eyes of the industry, with the development of urbanization and the improvement of business ability, it is possible for retail channels to sink under the background of difficult store location. The sinking of retail channels has also intensified the "sovereignty" war between regional oligarchs and national chain enterprises.
Liu Hui, chief consultant of Beijing Zhao Yi Retail Management Consulting Company, told the National Business Daily that the whole department store industry is in good condition in the third-tier market and is optimistic about the future growth of the market.
However, the development of department store chain enterprises in third-and fourth-tier cities is very different. On the one hand, it is reasonable for the department store industry to sink into third-and fourth-tier cities, but high profits are often accompanied by high risks. According to Liu Hui, the so-called high risk is reflected in many aspects. "Although the competition in third-and fourth-tier cities is not fierce and the cost is relatively low, the local consumption power may not match, and it is difficult for enterprises to break through the break-even point." In his view, there will be a gap between consumers' spending power and expectations, while in the third-and fourth-tier markets, consumers will not only go shopping in the local wholesale market, but also go to street shops for consumption. "Many brand counters are also located in the street. "
But this situation is relatively good in supermarket chains. Liu Hui said that with consumers in third-and fourth-tier cities paying more attention to consumption quality, more groups began to choose to shop in supermarkets.
In recent years, these regional retailers have been trying to go out or enter the first-and second-tier markets. But according to analysts, there is almost no success. "No management team, no top management ideas and strategies. Ningbo Sanjiang is a typical example. " Liu Hui pointed out that Sanjiang, as a regional supermarket, occupies many outlets with good geographical location, which is obviously its current value point, and its subsequent fate will also be merged. For regional retailers, being merged is also the only way out. "Compared with national retailers, they are too small to resist risks."
Some insiders pointed out that since last year, the rapid development of the whole department store industry in the past decade has been reversed. In 2065 438+03-2023, the department store industry in China will be very difficult, during which many department stores will close down and be merged, and the situation reflected by supermarkets is more obvious. "A large-scale merger of supermarkets has begun."
"The retail industry is facing the problem of increasing costs." Liu Hui told reporters that the whole retail industry is better controlled by low wages, low labor efficiency and high cash flow. Now it is difficult for sales to improve, which leads to stagnant cash flow and increased labor costs, but labor inefficiency still exists and the living conditions of enterprises are not good. "Many small retail enterprises relied on the sea tactics in the early stage, and now the cost is rising. Such tactics are no longer working."