10 Questions for Zixin Group

1.    What is Zixin’s business about and what are some key business segments?

• Zixin Group is a biotechnology company focused on the sweet potato industry, integrating seedling breeding, planting, product development, production, and sales. We promote the comprehensive development of the sweet potato supply chain through technological innovation and industrial upgrading. Key business areas include: 
  (i)    Cultivation and Supply: We collaborate with agricultural academies to innovate sweet potato varieties, cultivate seedlings, and lease over 1,300 acres of farmland to produce around 20,000 tonnes of fresh sweet potatoes annually.
  (ii)    Product Innovation and Food Production: We ensure food safety with a dedicated R&D space and advanced testing equipment, and own manufacturing facilities to produce a wide variety of sweet potato food products.
  (iii)    Sales Channel Development and Branding: We use a multi-channel sales and marketing strategy that includes proprietary brands, established sales and distribution networks both online and conventional channels, and collaborations with well-known snack food brands. 
  (iv)    Recovery and Recycling: Utilises a proprietary probiotic fermentation technology to convert sweet potato agricultural waste into nutritional feedstock for poultry and livestock feeds, promoting a circular economy and reducing environmental pollution.

2.    How do you see Zixin’s business segments and revenue streams evolving over the next three to five years? Are there plans to diversify or expand existing operations?

• Zixin Group has increased revenue streams by expanding product offerings to include seedlings, varieties of fresh sweet potatoes, snack and convenient foods, functional foods, and animal feedstock through technological innovation and industrial chain optimization.
• We will continue to expand our established business segments across the industrial value chain by focusing on R&D and producing nutritional sweet potato foods and functional products to meet diverse consumer needs. We will also explore applications of sweet potatoes in animal feed and bio-extracts to maximize their value. 
• Additionally, Zixin is involved in a rural revitalization project with CITIC Construction, replicating its sweet potato industrial value chain model from Liancheng County, Fujian Province to Lingao County, Hainan Province, marking the first such replication in China.

3.    With an 85% utilisation rate for snack product manufacturing, are there plans to expand production capacity or introduce new products in the coming years?

• Zixin Group is expanding our production capacity and product range with the newly developed high-tech manufacturing facility, which could increase our annual production capacity by 2.6 times from our current levels of 13,700 tonnes. Phase one is now complete with three automated production lines designed for higher-margin products such as purple sweet potato powder.
• Our newly developed probiotic-infused fermented sweet potato poultry feedstock has recently earned an initial year-long order. We believe our ability to convert agricultural waste, such as sweet potato peels, leaves, and stems into nutritious, high-quality feed ingredients optimises sweet potato resources and enhances the sweet potato industry.

4.    Are there plans to enter new geographic markets beyond China or product segments in the near future? If so, which areas are being considered?

• As part of our international expansion strategy, we are preparing to further develop the sweet potato industry in Southeast Asian countries and selected African countries.

5.    How does Zixin assess its competitive position within the industry, and what strategies are in place to maintain or enhance this position?

• Zixin Group is a leading agricultural industrialization enterprise in Fujian Province. While we focused on enhancing production processes and ensuring consistent product quality and taste in our products, we are concurrently building sales and distribution networks, employing e-commerce platforms and physical stores to optimize the efficiency of our integrated industrial value chain.  

6.    How do rural revitalisation projects in Lingao and Lankao counties contribute to Zixin’s business growth and community impact?

• Zixin Group and CITIC Construction will jointly promote the sweet potato industry in Lingao County, Hainan Province. Lingao County will be the first replication site for Zixin Group to expand from Liancheng County, Fujian Province. The replication of the sweet potato industrial value chain model is expected to bring significant business growth.
• Dongying Town in Lingao County currently boasts approximately 100,000 mu (about 16,493.69 acres) of ecologically arable land, which can be used as a planting base. This will boost local farmers' income and productivity as well as provide additional job opportunities for the local community in Lingao County.   
• We are actively engaging in communication with relevant local government departments regarding the rural revitalisation project in Lankao County, Henan Province.

7.    How does Zixin plan to capitalise on the Chinese government’s push to reduce soymeal in animal feed? What role does Zixin’s proprietary probiotic fermentation technology play here?

• Our proprietary probiotic fermentation technology breaks down agricultural waste like sweet potato peels, leaves, and stems, creating soluble peptides and other substances. This biological fermentation process effectively resolves the side effects that may cause bloating and diarrhoea when unfermented agricultural by-products are consumed by poultry and livestock. 
• Through this technological innovation, Zixin Group converts agricultural waste into an alternative feedstock that is rich in nutrients and beneficial live bacteria. The benefits of this probiotic-infused fermented sweet potato feedstock include reducing the use of high-protein ingredients such as soymeal and thereby reducing feed costs.

8.    What strategies are in place to mitigate the risks of climate change and extreme weather events on agricultural output?

• Zixin Group has implemented strategic actions to mitigate climate change impacts on agricultural productivity:
  (i)    Climate Monitoring and Early Warning: We partner with local meteorological centers to obtain for real-time climate data monitoring and early warnings, enabling timely precautions against extreme weather.
  (ii)    Optimising planting: We adjust planting structures and cultivate sweet potato varieties suited to different climates, ensuring stable cultivation and improved output. We also enhance soil quality through conservation tillage and crop residue management, and reduces chemical pollution by using fertilizers and pesticides judiciously.
  (iii)    Promoting efficiency: Our farmlands utilise efficient irrigation methods like drip and sprinkler systems, reducing water wastage and improving irrigation efficiency. 
   

9.    How does Zixin ensure sustainable farming practices for contracted farmlands, and how does this impact harvest quality and yields?

• Zixin Group employs sustainable farming strategies to achieve high-quality harvests and yields. This includes focusing on soil health management by using crop rotation, deep ploughing, and green manure planting to improve soil structure and fertility, while controlling chemical fertilizers and pesticides to protect soil balance. We complement this with efficient water use and scientific planting and management techniques, including precision fertilization and pest prediction and regular training and technical guidance to farmers. 
• These strategies improve soil structure and water-nutrient conditions, resulting in well-developed root systems, plump tubers, and bright colours, which enhance marketability and nutritional value, as well as consistent and sustainable sweet potato harvest yields.

10.    What is Zixin’s value proposition to its shareholders and potential investors? What do you think investors have overlooked?

• We believe investors may have overlooked the business philosophy and transformation of Zixin Group over the last few years. The company has evolved from a single-segment business to a comprehensive operator of the sweet potato supply chain, integrating biotechnology and the circular economy, and establishing a traceable product ecosystem with significant market potential and replicable business model.
• Zixin Group's value proposition lies in its technological innovation, market-driven growth, integrated industrial value chain, and sustainable development strategy. With advanced R&D capabilities in biotechnology and food science, Zixin continuously launches novel products, transforming scientific research into practical applications. 
• Zixin's fully integrated sweet potato value chain, from planting to sales, ensures product quality, supply stability, and cost synergies, enhancing operational efficiency and investor returns. In terms of sustainable development, Zixin reduces environmental impact through green production, energy conservation, and the circular economy, attracting investors interested in sustainability.
   

10 in 10 – 10 Questions in 10 Minutes with SGX-listed companies

Designed to be a short read, 10 in 10 provides insights into SGX-listed companies through a series of 10 Q&As with management. Through these Q&As, management will discuss current business objectives, key revenue drivers as well as the industry landscape. Expect to find wide-ranging topics that go beyond usual company financials.

This report contains factual commentary from the company’s management and is based on publicly announced information from the company.

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For more company information, visit www.zixingroup.com.sg

Click here for Zixin’s 1H25 results release.