The Wattle Health Australia Ltd (ASX: WHA) share price has shot 5.3% higher this morning after its Credit Suisse Dairy Day presentation highlighted key developments for the company in the last 6 months.
What were the highlights of the presentation?
The presentation focussed on Wattle Health laying its foundation in FY18 including its investment in Blend and Pack (B&P) and the Corio Bay Dairy Group joint venture (JV) with Organic Dairy Farmers of Australia (ODFA).
The company's focus on FY19 is on "designing the consumer experience" which includes the establishment of its premium organic brand (Uganic), the agreement to purchase 51% of B&P and by securing supply of Organic A2 Fresh Milk.
The company also plans to launch a suite of organic products in Q1 FY20.
How has Wattle Health fared against its competitors?
The macro environment for Wattle Health and key competitors A2 Milk Company Ltd (ASX: A2M) and Bellamy's Australia Ltd (ASX: BAL) remains robust with signs of future growth.
According to presentation data taken from the Australian Organic Market Report 2018, dairy sales in China are predicted to grow by US$1.8 billion by 2021, largely driven by infant formula demand.
Wattle Health and Bellamy's are still awaiting approval from the Chinese food and drug regulator (State Administration for Market Regulation or "SAMR") for the sale of its products into China, with no guidance on when this process will be complete.
In the meantime, the A2 Milk share price has been a star performer of the S&P/ASX200 Index (ASX: XJO) and has climbed a phenomenal 2,332% in the last 5 years.
The Bellamy's share price is up 46% this year alone and is trading on a P/E multiple of 29.6x earnings but there's plenty to suggest that there is room for the stock to surge higher in 2019.
For those who want to take more of a high-risk, high-reward trade, I'd suggest checking out this buy-rated stock that could capitalise on a booming $22 billion industry.
