Would you like a house with that milk powder and rapid antigen test?
When it comes to diversification, the folk at Jatcorp (ASX: JAT) are happy to ride whatever wave is rising and with their strong ties to China through their distribution network, the dairy products company has entered the real estate market with the launch of Jat Estates.
Owned 85% by Jatcorp and 15% by Executive Director Ms Rong Ma, Jat Estates was created in response to an approach from a developer keen to utilise Jatcorp’s Chinese networks for the purpose of selling real estate. The business is still in its infancy but with Jatcorp contributing $10,000 per month to fund startup operation, they expect the division to be breakeven before the end of CY 2022 with three staff members currently working in it.
It’s somewhat of a pivot from Jatcorp’s primary business of dairy product production but given the audience for those products is mostly based in Asia, the expansion is low risk for the time being.
According to the newly created website for Jat Estates, they will “help you buy or sell your property quickly” and are fully bilingual in English and Mandarin. The site already has 8 real estate listings and boasts accreditation from the Real Estate Institute of Victoria.
On top of that expansion, Jatcorp has been very busy over the December quarter where they also launched their eCommerce platform JATLIFE as an owned platform to supply their diverse range of products domestically and internationally. While the majority of those products are their dairy products manufactured from their ANMA manufacturing facility, the Company will likely also use it to sell their BabyCare line of baby products.
At the start of January, the site was even selling rapid antigen tests (RAT) delivered to your door amid the COVID spike that saw supermarkets and pharmacies depleted, for $13 each.
In other news for shareholders, the Company has also finally opened Shanghai Boutique, a retail store physically located in Shanghai for in-store sales of their Australian-manufactured products. On top of their in-house brands, the store has also attracted local distributors keen to gain exposure to customers seeking premium health and wellness products.
Since opening Shanghai Boutique, the online sales of a number of products displayed have increased significantly. Specifically, sales of more than 14,000 bottles of Hopefern Avocado and Walnut Oils and 3,000 bags of Ione Milk Powder have been achieved. This store has been penciled in to be opened almost two years ago but major lockdowns in China prevented doing so given the drying of foot traffic due to COVID-19.
For the Quarter ended 31 December 2021, Jatcorp generated $9.6 million in revenue which represented a 50% increase on the September quarter for them, primarily from their dairy products and meat alternative products.
Going forward, Jatcorp could have another hugely popular product in the pipeline having commenced scientific testing of Immune Support formulas to assess anti Covid-19 (Delta variant), in collaboration with RMIT. Clinical trials for these products have already received funding support from the Federal Government keen to see if they can boost immunity to SARS- Cov-2 and its mutated variants.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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