Jiangxi Huangshanghuang Group Food Co.,Ltd. is looking to diversify beyond its struggling braised food business by entering the freeze-dried food sector. The company recently announced plans to spend 495 million yuan to acquire a 51% stake in Fujian Lixing Food Co., Ltd., which will become its controlling subsidiary.
Jiangxi Huangshanghuang Group Food specializes in the research, development, production and sales of braised meat products and ready-to-eat side dishes. As a major player in the braised food industry, the company has faced challenges in recent years, with declining sales in both main business segments and continuous store closures. From its previous attempt to acquire Zhancui Food to enter the leisure snack market, to now crossing into freeze-dried foods through this acquisition, Jiangxi Huangshanghuang Group Food's intention to seek new growth drivers has become increasingly apparent.
**Entering the Freeze-Dried Food Sector**
According to the acquisition announcement, Jiangxi Huangshanghuang Group Food has signed equity transfer agreements with Lixing Food shareholders Lin Jieben, Wang Yonghe, Guo Shusong, Zhao Zhijian, Lin Jianqing, Shengxing Investment, and Zhongli Investment to acquire a combined 51% stake in Lixing Food for approximately 495 million yuan.
Founded in 2006, Lixing Food operates through both OEM processing and its own brand development. The company owns 37 freeze-drying production lines and 8,000 square meters of freeze-drying equipment, with annual production capacity of nearly 6,000 tons of various freeze-dried products and nearly 10,000 tons of plant extract powders and concentrates. Its production capacity and market share rank among the top in China, earning it the title of "full-category freeze-drying master."
As of June 30, 2025, Lixing Food's net assets totaled 277 million yuan, while third-party assessment agencies valued the company at 978 million yuan, representing a 252.58% premium. Through negotiations, the parties agreed on a 970 million yuan valuation for 100% of Lixing Food's equity.
In terms of performance, Lixing Food generated revenues of 415 million yuan and 251 million yuan in 2024 and the first half of 2025, respectively, with net profits of 42.22 million yuan and 41.88 million yuan. The company has committed to achieving non-recurring net profits of at least 75 million yuan, 89 million yuan, and 100 million yuan in 2025, 2026, and 2027, respectively, with cumulative net profits of no less than 264 million yuan.
Regarding the acquisition, Jiangxi Huangshanghuang Group Food stated that the company has consistently pursued a product diversification strategy, and Lixing Food's products and consumption scenarios complement the company's existing business. Beyond retail channels, freeze-dried foods are widely used in aerospace, military, outdoor exploration, and medical fields, serving different consumer groups. The company can leverage Lixing Food's sales channels and market resources to enter emerging markets, reach broader consumer groups, break existing market limitations, and achieve diversified market expansion. The two companies had previously collaborated in 2021, when Jiangxi Huangshanghuang Group Food's subsidiary Zhenzhen Laolao partnered with Lixing Food to develop freeze-dried zongzi products.
Food industry analyst Zhu Danpeng views this acquisition as more of a "mutual benefit" arrangement rather than a "strong alliance." "The Lixing Food that Jiangxi Huangshanghuang Group Food is acquiring is relatively small in scale, with limited expected contribution that may struggle to effectively support overall performance," Zhu said.
**Core Business Under Pressure**
Acquisitions are not new territory for Jiangxi Huangshanghuang Group Food. In December 2024, the company planned to acquire Chaozhou confectionery heritage brand Zhancui Food, but the transaction was terminated half a month later due to "inability to reach consensus with the target's controlling shareholders on relevant terms regarding the acquisition of controlling rights."
Earlier, Jiangxi Huangshanghuang Group Food spent nearly 190 million yuan in 2015 and 2023 combined to gain control of Zhenzhen Laolao, entering the rice products sector and developing a series of zongzi products including hand-shredded braised duck zongzi.
Behind these cross-sector acquisition moves lies Jiangxi Huangshanghuang Group Food's continuously declining revenues in recent years. Financial reports show that in the first half of 2025, the company achieved revenues of 984 million yuan, down 7.19% year-over-year. Looking at a longer timeline, Jiangxi Huangshanghuang Group Food's revenue decline has persisted for several years. From 2021 to 2024, the company reported revenues of 2.339 billion yuan, 1.954 billion yuan, 1.921 billion yuan, and 1.739 billion yuan, representing year-over-year declines of 4.01%, 16.46%, 1.7%, and 9.44%, respectively.
From a business perspective, sales volumes for both main business segments supporting company performance have shown declining trends. From 2021 to 2024, Jiangxi Huangshanghuang Group Food's meat product sales dropped from 36,700 tons to 22,800 tons. In the first half of this year, meat product sales fell 15.69% year-over-year to 10,200 tons. In 2021, rice product sales reached 34,000 tons, up 4.73% year-over-year, but starting in 2022, this business segment saw continuous sales declines, dropping to 26,000 tons in 2024. In the first half of 2025, rice product sales totaled 16,000 tons, down 12.2% year-over-year.
Meanwhile, Jiangxi Huangshanghuang Group Food's store expansion has fallen short of expectations. In 2024 and the first half of this year, the company experienced net decreases of 837 and 762 stores, respectively, with franchise stores decreasing by 816 and 715 stores. The company noted in its interim report that due to changing consumption scenarios, revenue per store for established braised meat processing businesses continues to decline year-over-year.
According to Red Dining Industry Research Institute data, the braised food market reached 333.2 billion yuan in 2024, up 4.8% year-over-year, while the compound annual growth rate from 2018 to 2023 was 6.4%. The braised food industry's growth has clearly decelerated. Faced with continuously shrinking sales of core products and declining store numbers, seeking breakthroughs beyond the main business has become a new option for Jiangxi Huangshanghuang Group Food.
Pangu Think Tank senior researcher Jiang Han noted that from a short-term perspective of alleviating performance pressure, Jiangxi Huangshanghuang Group Food's cross-sector acquisitions of companies like Lixing Food can quickly enter new markets and relieve pressure from declining core business, which has positive significance to some extent. However, to achieve synergistic development of products and brands in newly acquired sectors, the company still needs effective integration and management across research and development, production, and sales operations.
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