Mav­er­ick multi-bil­lion­aire

Af­ter civil ser­vice, real es­tate, bev­er­ages, food and ed­u­ca­tion, Chen Sheng is look­ing for stiffer chal­lenges

China Daily (Canada) - - BUSINESS - By FANFEIFEI fanfeifei@chi­

You may be for­given if you as­sume Chen Sheng, 53, a newly minted multi-bil­lion­aire, must be one of those su­per-suc­cess­ful Chi­nese In­ter­net startup founders. But the chair­man and pres­i­dent of Tiandi No 1 Bev­er­age Inc be­lieves newage busi­nesses are not the only route to riches.

In fact, Chen swears by tra­di­tional in­dus­tries. What’s more, he rides a va­ri­ety of them: real es­tate, bev­er­ages, food. Wears other hats too: dar­ling of the cap­i­tal mar­kets, po­ten­tial in­vestor in star­tups, pub­lic speaker, founder of an ed­u­ca­tional institution.

And to think he started his ut­terly fas­ci­nat­ing ca­reer as a civil ser­vant in hishome­townZhan­jiang, Guang­dong prov­ince, af­ter re­ceiv­ing a bach­e­lor’s de­gree in eco­nomics from Pek­ingUniver­sity in 1984.

A few years in civil ser­vice con­vinced Chen he is made to do and achieve dif­fer­ent things in life. So, in early 1990s, he set up a real es­tate com­pany in his home­town. It went on to be­come the mar­ket leader in the city’s real es­tate sec­tor in just three years.

The di­ver­si­fi­ca­tion into the bev­er­age busi­ness hap­pened by chance.

“In 1997, a vis­it­ing cen­tral leader chose to mix Sprite (a lemon-fla­vored fizzy soft­drink) with vine­gar at a ban­quet in Guang­dong. That for­mula be­came a rage. Sens­ing an op­por­tu­nity, I de­cided to ex­plore the mar­ket po­ten­tial for a vine­gar bev­er­age,” said Chen.

Eigh­teen years on, Tiandi No.1 is now China’s largest vine­gar bev­er­age brand with a more than 40 per­cent mar­ket share. In his home prov­ince Guang­dong, the drink com­mands an 80 per­cent mar­ket share.

On Aug 20 this year, the Guang­dong-based Tiandi No 1 Bev­er­age Inc listed on the Na­tional Eq­ui­ties Ex­change and Quo­ta­tions, also known as New Third Board, and its ini­tial pub­lic offering raised 175 mil­lion yuan.

In Oc­to­ber, the com­pany is­sued ad­di­tional shares to raise 625 mil­lion yuan more, push­ing its mar­ket val­u­a­tion to about 13 bil­lion yuan, and the worth of Chen’s more than 80 per­cent stake in it past 10 bil­lion yuan ($1.58 bil­lion).

That put him just be­hind Wu Gang, pres­i­dent of JD Cap­i­tal Co Ltd, an in­vest­ment firm, among the founders of com­pa­nies listed on the NewThird Board. Wu’s net worth is es­ti­mated at 18 bil­lion yuan.

Why the New Third Board? “We want to raise more cap­i­tal for merg­ers and ac­qui­si­tions, es­pe­cially at a strate­gic level,” said Chen.

Ac­cord­ing to Tiandi’s lat­est fi­nan­cial re­port, in the Jan­uary-June pe­riod, the com­pany’s rev­enue soared 99 per­cent year-on-year to 639 mil­lion yuan, yield­ing a net profit of 148 mil­lion yuan.

In2013and2014, rev­enue­was1.17 bil­lion yuan and 1.13 bil­lion yuan, and net profit was 314 mil­lion yuan and 253 mil­lion yuan, re­spec­tively.

But Chen isn’t just known for Tiandi’s fi­nan­cial suc­cess. He is the “king of pork” in Guangzhou. And that story be­gan by chance as well.

In 2003, a tele­vi­sion crewinXi’an found that a graduate named Lu Bux­uan, also Chen’s univer­sity mate, sold pork in a lo­cal mar­ket for a liv­ing. Lu’s story was to stir the na­tion’s con­science.

“I also watched that piece of news on TV,” said Chen. That in­flu­enced his foray into pork, es­pe­cially af­ter he dis­cov­ered the chaotic pork mar­ket pre­sented a busi­ness op­por­tu­nity.




Guang­dong No

1 Food Co Ltd to fo­cus on re­search and de­vel­op­ment in do­mes­tic pigs, their rear­ing and pork sales at a time when im­ported pigs held sway.

“Since China’s re­form and open­ing up, more and more for­eign pigs were in­tro­duced into the coun­try. Their pop­u­lar­ity was at the ex­pense of do­mes­tic breeds due to their lower cost. Also, you need shorter time to raise im­ported breeds. How­ever, the qual­i­tyof do­mes­tic pork is­much bet­ter, more ten­der and juicy,” said Chen.

He is con­fi­dent history will re­peat it­self. There was a time when the Chi­nese largely con­sumed do­mes­tic pork. Now, with ris­ing in­comes and as­pi­ra­tions for high-qual­ity life style, more and more peo­ple have the means to af­ford do­mes­tic pork. It’s only am­at­ter of time be­fore they re­dis­cover their taste for Chi­nese pork. So, in just two years, Chen grew his pork busi­ness to a 200store chain with an an­nual rev­enue of 200 mil­lion yuan.

Chen also in­vited his fel­low alum­nus Lu as a guest teacher to the butch­ers school in Guang­dong that he founded. “Lu de­signed a train­ing course in pork sales. He has so­much

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