Definitive Analysis
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China Mengniu Dairy Company Limited (2319.HK)

Company Dividend Discount ModelIndustry: Packaged FoodsSector: Consumer Defensive

Valuation Snapshot

Stable Growth$34.33 - $196.07$64.55
Multi-Stage$30.06 - $32.88$31.45
Blended Fair Value$48.00
Current Price$14.69
Upside226.73%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS22.10%17.27%0.490.400.380.270.180.180.120.090.140.15
YoY Growth--21.18%5.40%40.68%51.56%-0.33%46.84%40.02%-37.61%-5.54%49.62%
Dividend Yield--2.97%2.24%1.22%0.76%0.46%0.64%0.57%0.45%1.05%1.41%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)3,938.75
(-) Cash Dividends Paid (M)3,915.59
(=) Cash Retained (M)23.17
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)787.75492.34295.41
Cash Retained (M)23.1723.1723.17
(-) Cash Required (M)-787.75-492.34-295.41
(=) Excess Retained (M)-764.59-469.18-272.24
(/) Shares Outstanding (M)3,935.183,935.183,935.18
(=) Excess Retained per Share-0.19-0.12-0.07
LTM Dividend per Share1.001.001.00
(+) Excess Retained per Share-0.19-0.12-0.07
(=) Adjusted Dividend0.800.880.93
WACC / Discount Rate6.31%6.31%6.31%
Growth Rate3.89%4.89%5.89%
Fair Value$34.33$64.55$196.07
Upside / Downside133.69%339.40%1,234.70%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)3,938.754,131.224,333.084,544.824,766.904,999.835,149.82
Payout Ratio99.41%97.53%95.65%93.76%91.88%90.00%92.50%
Projected Dividends (M)3,915.594,029.154,144.474,261.444,379.944,499.844,763.58

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate6.31%6.31%6.31%
Growth Rate3.89%4.89%5.89%
Year 1 PV (M)3,753.893,790.023,826.16
Year 2 PV (M)3,597.523,667.123,737.38
Year 3 PV (M)3,446.343,546.823,649.24
Year 4 PV (M)3,300.183,429.093,561.75
Year 5 PV (M)3,158.893,313.883,474.89
PV of Terminal Value (M)101,042.64106,000.30111,150.67
Equity Value (M)118,299.45123,747.23129,400.09
Shares Outstanding (M)3,935.183,935.183,935.18
Fair Value$30.06$31.45$32.88
Upside / Downside104.64%114.07%123.85%

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