Hot topicAs of February 15, the closing price of $5.21 Australian dollars, the market value of 3.87 billion, the price-earnings ratio of 51.7, the annual price fluctuation range of $4.97 - $10.66, the share price in June 2020 had reached $20.05, and then all the way down to the current struggle around $5 Australian dollars. Once A2M is how brilliant, and now A2M has too many investors deeply set in it, so it is necessary for us to do a comprehensive analysis, in-depth understanding of A2M, to help us predict the future trend of stock prices.What is A2? The rise of A2 MilkA2 milk refers to the beta casein type of animal milk as A2 beta-casein, which is mainly used in the common classification of milk. Because early cows produced A2 milk, as opposed to A1 milk, which was caused by a genetic mutation in later captivity, A2 milk is considered more primitive. Compared with A1 milk, A2 milk can significantly reduce digestive tract discomfort during human digestion and absorption, and many digestive tract discomfort that is thought to be caused by lactose intolerance is actually caused by A1 protein. However, only a small number of Western dairy cows widely used in dairy processing can produce A2 milk. To produce A2 milk, enterprises need to conduct professional genetic testing on cows, screen out pure A2 cows, and process the milk produced by these cows in the later stage. Due to the rare breed of cattle, the special selection process and other factors, A2 milk is more valuable.Looking back to 2015, Australia's purchasing agent was in full swing, with nine out of ten mothers selling Australian health products to the huge Chinese market, and the local duty-free shops that used to be rich in oil and water in Australia were destroyed. The products of various brands were stripped to the skin, and the Chemist Warehouse of Australia was the one that got fired up. On the list are a range of pharmacy holdouts such as Blackmores and Swisse, as well as today's A2 Milk. Because of the repeated violence of China's local dairy products, poor supervision, coupled with the opening of the birth policy, China's local demand for overseas dairy products has risen exponentially, which opens the road to the rise of A2M.Company financial analysis and current situationThe rise of A2M is reflected in the main business revenue, the company from China and Asia market accounted for 2.5% of 2.745 million in 2014, to 48.35% of 583 million in 2021; The local revenue decreased from 97.5% in 2014 to 46.38% in 2021, and the revenue of 560 million yuan was even lower than that of China and Asian markets; Of course, A2M has also opened up the US market, accounting for 5.27% by 2021. In fiscal 2021, the company's main business revenue was NZ $1,207 million, down 30.3% from the previous year. The company's gross profit was NZ $509.7 million, down 47.4% from the previous year. Earnings before interest, tax and depreciation were NZ $116 million, down 78.8%. The company's net profit after tax was NZ $80,658,000, a decrease of 79.1%. The company's gross margin decreased to 42.3% in FY21, compared to 55.96% in the same period last year. In addition to the increase in cost of sales due to the increase in milk source prices and the impact of changes in foreign exchange rates, the Company also made an inventory impairment of NZ $108.6 million on its inventory during the period, thus driving up the Company's cost of sales. Excluding the impact of this inventory impairment, gross margin for FY21 would have been 51.3%.In addition, A2M's net tangible assets per share at the end of FY2021 were NZ $1.37 (NZ $1.48 in the same period last year). Based on the Board's consideration of capital management initiatives, it has been decided not to return capital to shareholders during this period and, taking into account market volatility, potential opportunities for reinvestment, and the strength of the balance sheet, no final dividend is planned. Given the ongoing uncertainty over COVID-19 and the rapid changes in the Chinese market, the company did not give specific earnings guidance for fiscal year 2022.Shareholder analysis and shareholding changesThe company's current shareholder ownership is still relatively concentrated, with more than 100,000 registered shareholders at the end of fiscal 2021, but the top 200 largest shareholders own more than 70% of the company's shares. In terms of investment companies, the famous Blackstone, Goldman Sachs, UBS and so on are still its main shareholders, according to the data at the end of 2021, Blackstone reduced its holding of 9,446,200 shares, the largest shareholder Perpetual increased its holding of 7.7 million shares, and Morgan Stanley increased its holding of 10 million shares.If you want to get more Chinese analysis of Australian stocks or learn more about Australian stock market investment opportunities, please contact our customer service assistant or call our Chinese service phone in Sydney or Melbourne for consultation.