Is Jatenergy Ltd the next A2 Milk Company Ltd?

I’m sure the majority of readers will be very familiar with the likes of A2 Milk Company Ltd (ASX: A2M) and Bellamy’s Australia Ltd (ASX: BAL).

These two companies have been going gangbusters over the last few years thanks to the incredible sales growth they have achieved due to the insatiable demand for infant formula in China.

But they aren’t the only companies looking to strike it rich in this market. Some investors will be aware of fledgling infant formula companies Bubs Australia Ltd (ASX: BUB) and Wattle Health Australia Ltd (ASX: WHA).

They have each signed countless distribution agreements over the last 12 months with some of the biggest names in retail. This has led to their market capitalisations ballooning to eye-watering levels, despite the agreements not yet resulting in a notable lift in sales.

The new challenger.

One infant formula challenger that I’m betting a lot of readers won’t be familiar with is Jatenergy Ltd (ASX: JAT).

The China-based energy-related technology marketer stepped into the infant formula market in January when it announced the acquisition of a 51% interest in Golden Koala Group Pty Ltd.

Golden Koala is an Australian milk powder company which markets the Golden Koala Infant Formula product, along with adult full cream and skim milk powder.

Management is hoping to follow in the footsteps of Bubs by signing a distribution agreement for its infant formula with

The company is currently in discussions with representatives from and appears optimistic that a deal will be reached. This would give it access to over 260 million active customers of the platform.

Should you invest?

I think it is far too soon to invest in Jatenergy and even Bubs and Wattle Health. While all three could potentially replicate a2 Milk’s success in the Chinese market in the future, just having products available to these consumers does not necessarily guarantee sales.

Both a2 Milk Company and Bellamy’s have spent a lot of time and money creating strong brand images and marketing their products to Chinese consumers. I think this is vital if you want to succeed in such a competitive market. I’m not convinced, as of yet, that the others have the resources to do the same.

Instead of risking your money in Jatenergy, I think investors ought to consider these top growth shares which are kicking goals at the moment.

The Disruptors: 3 Revolutionary Aussie Companies to Back for 2018

We’re living in one of the most exciting times in investing history. Innovation and a booming culture of entrepreneurship are constantly creating new companies with the potential to make forward-thinking investors very rich. Now more than ever, one small, smart investment could make a huge difference to your wealth.

That’s why at The Motley Fool we’ve been scrutinizing the ASX to uncover the kinds of companies that we believe could turn into the next Cochlear or REA Group.

We’ve found three exciting companies that we believe re poised to perform in the new year. Click here to uncover these ideas!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of A2 Milk. 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 Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.