Revenue gap widens between dairy companies

The revenue gap between domestic dairy companies widened in 2012, as experts said that increasing market concentration will benefit the industry in the long run, the National Business Daily reported.

The Shanghai-listed Inner Mongolia Yili Industrial Group Co Ltd reported 42 billion yuan ($6.81 billion) in sales revenue in 2012. This is the first time that the company’s sales revenue reaches 40 billion yuan.

In comparison, the Hong Kong-listed China Mengniu Dairy Co Ltd reported 36.1 billion yuan in sales revenue in 2012, while Shanghai Bright Dairy & Food Co Ltd reported 13.7 billion yuan in total revenue in 2012.

The revenue difference between Yili and Mengniu increased to 5.9 billion yuan in 2012 from about 60 million yuan in 2011.

In 2011, the sales revenues of the three companies were 37.45 billion yuan, 37.39 billion yuan and 11.8 billion yuan, respectively.

Song Liang, a dairy industry analyst at the Distribution Productivity Promotion Center of China Commerce, was quoted by the National Business Daily as saying that increasing market concentration will allow leading companies to achieve better results and will benefit the whole industry in the long run.