Yes, $37M is a big jump from AHF’s current run rate but look at how a2 Milk started. They didn’t flood supermarkets with massive volumes on day one; they focused on premium margins and effectively sold fewer units at higher prices eventually dominating China’s formula market. That’s the same play here.
Andy Z’s 100k mum-and-baby store network is a serious distribution edge especially for niche, high-EBITDA products.No, we don’t have a tin-by-tin breakdown yet, but a2 didn’t need ‘vertical integration’ from the jump either. They proved you can outsource, maintain strict cost discipline, and still command top dollar if consumers trust your brand.
The question isn’t ‘How many litres of milk per tin?’ It’s ‘Will a high-margin pivot succeed in a market that pays for premium?’ a2 showed it can. That’s why a harsh broker report wouldn’t change the maths on premium formula + lean overhead: a tight operation carving out just a fraction of a billion-dollar market can scale up and that’s far from a ‘pin the tail on the donkey.’
AHF Price at posting:
5.9¢ Sentiment: Buy Disclosure: Held
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