Happy Singles day. Okay, you probably haven’t heard of it, heck you might not even be single. But right now, today it doesn’t matter. Like all good days, capitalism, business and marketing have taken over, meaning clever and not at all desperate investors like you and I get to capitalise. So Singles Day, for those out of the loop is a pretty great concept, what started as a day where single folk like me would have parties and sing karaoke*, its turned into the biggest online shopping day in the world. Yeah, that’s bigger than Black Friday in the USA, Boxing Day everywhere and even pips our local (and problem plagued) click frenzy which happens periodically.
But what about the bulk gains Mick? Well loyal readers, I’m glad you asked.
Australia is fast becoming an export powerhouse, not relying on our dirty yet highly profitable resources anymore, we are transitioning to value added products like vitamins, baby formula and a favourite of yours truly, Wine. While the business doesn’t stop at any point in the year, today when single Chinese consumers wake up these businesses will be well geared to capitalise on the growth. The below companies have a presence in Tmall through a partnership with Australia Post, this platform alone contributes over US$9bn in a single day.
Now, where is the value on the ASX? Well get comfortable because I am about to share 3 high potential stocks which stand to benefit from this online shopping bonanza.
First cab of the rank is a Blue Lake Invest favourite Bellamy’s (ASX:BAL). Also an ASX favourite BAL has surged up the market in recent days, and has seen gains of 26% since we first introduced you guys to the super stock. But other investors may be starting to cotton on to the value of BAL in recent days, along with other baby formula producers BAL has been criticised for the lack of product available to mothers here in Australia. It is suggested that the reason for this is that BAL is reserving stock ahead of the online shopping bonanza to satisfy the huge demand from China today.
Now like me, you are probably wondering why is a company that produces baby formula going to strike it rich on ‘Single’s day’. But like I have said in the opening, this day has gone well beyond being about single folk and is now a major shopping day in China. The demand for products like what Unfortunately, we could not get stock quote ASX: BAL this time. produce are so high in demand that Australian’s are buying in bulk, and selling at a premium on eBay. The bottom line here is that the “White Gold Rush’ looks set to continue, and sales of this high cost, organic milk powder look set to surge today.
Another stock that has received plenty of airtime here at Blue Lake Invest is Blackmores (ASX:BKL), which like ASX:BAL has enjoyed a surging stock price in recent months. Having jumped 53% since we first mentioned ASX:BKL here at Blue Lake Invest, the high sales and market appeal are set to benefit greatly from Singles Day in China. Think about it, you’re single, you want to look and feel great? What better way than high cost vitamins that improve every aspect of your health? Okay you might not believe that, but enough Chinese people do.
A Hong Kong based company purchased the very prolific Swiss Vitamins for a modest $1.5bn. This speaks to the demand in Asia for Australian produced vitamins, but more importantly sent ASX based investors into a frenzy. No doubt another solid contribution to Single’s Day Unfortunately, we could not get stock quote ASX: BKL this time. could get a bit more attention from those overseas companies. Being a part of the $9bn Tmall sale BKL looks to impress once again.
But the Australian export party doesn’t end there. Let’s face it, you can’t end a good party without a great glass of wine. Treasury Estates (ASX:TWE) has done a great job to go after this mainstream wine export market, and like those mentioned above are poised to take advantage of the Tmall platform. Now the taste of Australian wine is yet to really grow on the Chinese consumers as they add some cola to help wash it down. Despite this the market is huge, and growing attributed to the ‘status’ that good quality Australian wine brings, and the booming middle class in China.
TWE hasn’t quite got the airtime on Blue Lake Invest like those listed above. But the trend here is impressive, having climbed 36% YTD FY16. In addition to that Unfortunately, we could not get stock quote ASX: TWE this time. have paid out a $0.08 dividend, and put in place a good long term strategy. The excitement here though is very much the potential of the Chinese market, and Single’s Day looks set to deliver great returns for these Australian wine producers.
Investors need to be cautious to pay too much to get a piece of the excitement of these companies. Right now, on the very simple calculations the ‘expert’ investors would probably argue that these stocks are overvalued. But these same investors would have said the same thing 5 months ago. Yet against the trend of the ASX all 3 stocks have soared on the market, and show no signs of slowing down.
*For those wondering, Horses by another great Australian export Darryl “The Man” Braithwaite is my karaoke song.
Did you want more insights like the 3 Super Single’s Day Stocks? Subscribe today by entering your email below.