Listing of agricultural enterprises: the challenge of lowering the threshold remains

In 2008, when the author studied the agriculture, forestry, animal husbandry and fishing company, an agricultural expert told me: the performance of the agriculture, forestry, animal husbandry and fishing company is not good, it is mainly supported by the sideline, and a large part of the profit depends on government subsidies. He believes that a considerable part of it is fake listing, after listing, circle a sum of money and then make plans, or engage in diversification, or simply sell shells and leave.

In recent years, many agriculture, forestry, animal husbandry and fishery companies have been listed on the stock market, with unlimited scenery and popularity, but the performance of many companies began to decline two or three years later, and some were stuck in the quagmire of losses. When it was sought after at that time, it felt like a sudden rise of a new force, with a new business or farming model, which turned out to be a pipe dream.

Recently, agriculture, forestry, animal husbandry and fishing companies have once again become a hot topic because a listed company has calculated hundreds of millions of yuan in seafood inventory losses. In fact, similar incidents have occurred one after another in the agricultural sector in the past.

Some people think that listed companies cheat because it is difficult to find, just as it is easy to commit crimes when street lights are not on; others think that because of the weather, this kind of enterprises are greatly affected by climatic conditions, and there are too many uncontrollable factors, because the animals and plants are farmed, and there will be diseases and insect disasters. All these can only show that it is difficult for the agricultural sector to achieve capital agglomeration and high profits.

Going back 100 years, agriculture, forestry, animal husbandry and fishing is the main source of wealth in the world, not only feeding the world's major population, but also providing major jobs, but now the proportion of agriculture, forestry, animal husbandry and fishing in the economy has become smaller and smaller.

Take A-shares as an example, there are only 83 listed companies in agriculture, forestry, animal husbandry and fishery, most of which have brands and enjoy brand premium, and some of them also have unique resources. The total number of A-share companies is 2571, and the overall performance of these 83 listed companies is not as good as that of the whole A-share, and these 83 companies are still outstanding in agriculture, forestry, animal husbandry and fishing.

In fact, agriculture, forestry, animal husbandry and fishing still provide the most jobs in China, but at the same time, the competition in the industry is fierce and the barrier to entry is low. It is difficult to count the number of competitors of any listed agriculture, forestry, animal husbandry and fishery company. On the other hand, the labor prices of these competitors are low, most of them will not calculate the input cost, and they will not leave aside their own labor input and capital investment in the annual income. In the most competitive field of crop cultivation, there have been no listed companies because of the lack of soil for listed companies to grow.

The reason why the government subsidizes an industry may be to support promising new industries, or it may be because the income of practitioners in that industry is not competitive and is more important in the economy as a whole. The Chinese government is also subsidizing agriculture, forestry, animal husbandry and fishing.

Agriculture, forestry, animal husbandry and fishing enterprises have ups and downs and it is difficult to create miracles in this industry, but listed companies are trapped in the capital market, which is not conducive to the development and financing of agricultural enterprises in some systems.

But there are some companies that do work miracles, such as some seed companies. The deep-seated reason is that they have mastered the cutting-edge science and technology, walked in the forefront of the industry, and the financial management is relatively standardized, which meets the relevant requirements. Now the threshold for listing has been lowered, and many agricultural enterprises are also gearing up to break into the capital market. However, if agricultural enterprises want to go far on the road of listing, they should learn from the experience of these companies to form effective measures, so that they can be listed successfully and perform well.