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when nongfu spring's zhong shanshan appeared on cctv's "dialogue" program, he opened with "sailing in the sea of ​​commerce, it is inevitable to encounter storms. this year, nongfu spring and i have experienced unprecedented tests."

for nongfu spring and zhong shanshan in 2024, it is undoubtedly full of challenges. since the death of zong qinghou at the beginning of the year caused a storm of public opinion, nongfu spring has been caught in an unprecedented public relations crisis. what followed was the controversy over the content of bromate, and then the recent financial report thunder. in the face of public opinion whirlpools, market tests and other issues, zhong shanshan finally chose to respond to everything in front of cctv's camera. in more than an hour of dialogue, zhong shanshan showed his frankness.

but it has been nearly a month since the end of the "dialogue", and the effect is not good. "kuaima financial media" found that since the opening of nongfu spring on august 12, the stock price of nongfu spring has fallen by more than 13 percentage points.

if calculated based on the recent high of hk$47.92 per share, nongfu spring has fallen by nearly 47% in the past four months, with its market value evaporating by hk$251 billion.

on september 9, nongfu spring's stock price continued to hit a new low during the trading session. its current market value is only hk$290 billion.

the continued collapse of nongfu spring's stock price has also caused zhong shanshan's wealth to shrink significantly. bloomberg billionaires data shows that although zhong shanshan still sits on the throne of china's richest man with a net worth of us$45.7 billion, he is only us$2.3 billion ahead of the second-place tencent group founder ma huateng.

throughout 2024, zhong shanshan's wealth has shrunk by 22 billion us dollars, making him the worst-hit billionaire. nongfu spring has indeed been a bit "miserable" recently.

public opinion continues to be turbulent

founded in 1996, nongfu spring is a well-known domestic drinking water and beverage manufacturer, with products covering drinking water, tea, functional drinks, fruit juice and other fields.

on september 8, 2020, nongfu spring entered the capital market and opened at hk$39.8 per share on the first day of listing. its market value once soared to hk$450 billion on the same day.

thanks to the outstanding performance of nongfu spring, zhong shanshan quickly became the richest man in china, and has been the richest man in china for three consecutive years.

however, the death of wahaha founder zong qinghou on february 25, 2024, dragged nongfu spring into a whirlpool of public opinion. first, zhong shanshan was accused of lacking sincerity for his wreath-laying mourning method, and netizens immediately dug up the grievances between zhong shanshan and wahaha.

soon, netizens began to boycott and refuse to buy nongfu spring products. sales at the official flagship store plummeted by nearly 90% in less than a week.

the incident continued to escalate. on the first day after zong qinghou's "first seven days", zhong shanshan published an article titled "zhong shanshan: two or three things between me and zong lao" on the official account of nongfu spring, responding positively to netizens' doubts. but netizens did not buy it, and more negative news about zhong shanshan and nongfu spring was uncovered.

from the attitudes of zong qinghou and zhong shanshan towards charity, to the comparison of the cultural elements on the bottle, to the issue of zhong shanshan's son zhong shuzi's american citizenship. under a series of comparisons, nongfu spring suddenly became a rat crossing the street that everyone wanted to beat.

in july, a drinking water test report released by the hong kong consumer council put nongfu spring at the center of controversy again. the report said that bromate was detected in nongfu spring's products. intake of large amounts of bromate can cause nausea, abdominal pain, diarrhea and vomiting, and in severe cases may affect the kidneys and nervous system. as soon as the news came out, nongfu spring became a hot topic again.

but soon nongfu spring issued a statement pointing out the three major mistakes of the hong kong consumer council, demanding clarification, apology and elimination of the impact. on july 18, the hong kong consumer council issued a clarification announcement, stating that the misunderstanding was caused by a discrepancy in the classification of test samples. after nongfu spring products fully met the relevant standards, the incident came to an end.

the basic foundation collapsed?

the public opinion incident directly brought down nongfu spring's first-half performance. although overall, the performance is still on the rise. revenue in the first half of the year was 22.173 billion yuan, a year-on-year increase of 8.36%; net profit attributable to the parent company was 6.240 billion yuan, a year-on-year increase of 8.04%.

revenue and net profit still achieved double growth, but the growth rate hit a record low. obviously, nongfu spring is not selling so well, and the biggest impact is packaged drinking water.

data shows that packaged drinking water revenue in the first half of the year was 8.531 billion yuan, down 18.31% year-on-year, and the proportion of revenue dropped from 51% in the same period last year to 38.5%.

regarding the changes in the drinking water business, nongfu spring mentioned in its financial report that in january and february, the sales of packaged drinking water were good, with revenue increasing by 19% year-on-year. however, since the end of february, online public opinion has dealt a heavy blow to nongfu spring's drinking water for four months.

at the earnings conference, nongfu spring management also mentioned that the impact of the public opinion incident has not been completely eliminated, and the net profit in the second half of the year will still be slightly lower than that in the first half of the year. as soon as the results were released, nongfu spring's stock price fell 13% the next day.

in fact, from the performance point of view, there are also bright spots. after years of cultivation, the tea brand oriental leaves has become more prominent. the revenue in the first half of the year increased by 59.5% compared with last year. including functional drinks and fruit juice drinks, the revenue of nongfu spring's entire beverage sector increased by 36.7% year-on-year, accounting for 61% of the revenue, the highest in history.

although the beverage business already accounts for half of the company's revenue, the heavy blow to packaged drinking water has still caused investors to lose confidence.

the biggest rival yibao's ipo was approved

unexpectedly, nongfu spring, which was caught in the whirlpool of public opinion, took the initiative to launch an offensive and restart its pure water business.

nongfu spring restarted the business that it had publicly abandoned 24 years ago with only one core purpose - to target yilibao.

over the past years, c'estbon has been deeply involved in the pure water market and has now become the biggest king in the pure water market. in addition, c'estbon's parent company, china resources beverage, has been approved for its ipo, and a pure water war seems inevitable.

as the largest market segment in the packaged drinking water market, the market size of pure drinking water is expected to increase from more than 120 billion yuan in 2023 to nearly 180 billion yuan in 2028. in the field of packaged drinking water, nongfu spring and c'estbon are ranked first and second, and wahaha ranks fourth. but in the pure water market, c'estbon and wahaha are ranked first and second.

in order to snipe yilibao, nongfu spring launched green-bottle pure drinking water in april, with a retail price of 2 yuan per bottle. in the nongfu spring douyin flagship store, the reference price of green-bottle pure drinking water is 14.9 yuan per bottle, and the discount price is 9.9 yuan per bottle. calculated as 12 bottles, the unit price of each bottle is about 0.82 yuan. during the 618 promotion, nongfu spring's pure water products directly rushed to the top of jd.com's new water drink rankings.

but yibao also has its trump card. backed by china resources group, whose businesses cover consumption, real estate and health, and china resources vanguard, which has more than 3,300 self-operated stores, yibao has a promising future.

"kuaima financial media" learned from yilibao's prospectus that china resources beverage has more than 1,000 cooperative distributors, more than 8,700 front-line sales staff, and covers more than 2 million outlets.