Here are 3 ways you could profit from China’s growing middle class

According to research from McKinsey & Company, approximately 76% of China’s urban population will reach middle class status by 2022.

Considering the country’s urban population is estimated to be around 730 million at present, by 2022 this would mean a middle class population of at least 550 million people.

Because of this it is no wonder that so many companies have their eyes firmly fixed on this incredibly lucrative market. Here are three that are aiming to profit from it:

a2 Milk Company Ltd (Australia) (ASX: A2M)

Despite the problems Bellamy’s Australia Ltd (ASX: BAL) has had in China, demand for a2 Milk’s infant formula continues to grow strongly in the country. In fact, in its half-year results the company reported a 348% increase in sales into China and Asia. This helped the company increase its infant formula market share to around 2.6%. As a premium product, I think a rising middle class can only be good news for a2 Milk.


BWX is the company behind the Sukin skincare brand. After its huge success in the Australian market, the company has focused its attention on the China and U.K. markets. Whilst the company’s expansion into the U.K. through the Boots pharmacy brand gets a lot of attention, I believe the recent launch of its Chinese online stores is equally noteworthy. In November BWX established Sukin flagship stores on both and, two of the world’s largest online retailers.


Tianmei Beverage Group is a fast-moving consumer goods company that sells a range of premium bottled water products through a network of 941 retail stores and supermarkets throughout China. Due to concerns over pollution, demand for bottled water has been on a meteoric rise. Between 2010 and 2015 Euromonitor estimates that bottled water consumption rose from 19 billion to 37 billion litres. In FY 2016 the company posted sales of $66.41 million and net profit after tax of $25.1 million. A significant jump from a year earlier. Tianmei Beverage Group certainly looks like an exciting company, but I would suggest investors keep it on their watch list for now until it provides its next trading update.

As well as the companies listed above, I believe these three exciting shares have explosive growth potential. Are they in your portfolio?

Top 3 ASX Blue Chips To Buy In 2017

For many, blue chip stocks means stability, profitability and regular dividends, often full franked..

But knowing which blue chips to buy, and when, can often be fraught with danger.

The Motley Fool's in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool's Top 3 Blue Chip Stocks for 2017."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

If you're expecting to see the likes of Commonwealth Bank, Telstra and Wesfarmers shares on this list, you'll be sorely disappointed. Not only are their dividends growing at a snail's pace, their profits are under pressure too due to the increasing competitive environment.

The contrast to these "new breed" blue chips couldn't be greater... especially the very real prospect of significant share price gains, something that's looking less likely from the usual blue chip suspects.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand - and how quickly the share prices of these companies moves - we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia owns shares of A2 Milk and BWX Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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