In morning trade the Bellamy's Australia Ltd (ASX: BAL) share price has continued its positive run and is up almost 3% to $11.43.
This means the infant formula company's shares are up 18% over the last two trading days.
Why is the Bellamy's share price up 18% in two days?
Investors have been scrambling to get hold of the company's shares after it announced the receipt of SAMR accreditation for its new Bellamy's branded formulation-series to be produced at the ViPlus Dairy facility in Toora, Victoria.
This product range is part of Bellamy's strategic plan to build out a tiered-product portfolio and penetrate the China offline channel.
The new Bellamy's-ViPlus series will target the premium segment of the offline channel and initially focus on Tier 3 and 4 cities.
Whilst this is certainly a big positive, it is important to note that this is a separate application to Bellamy's existing SAMR application to produce its organic series at Camperdown Powder. This product range is targeting the super-premium market which A2 Milk Company Ltd (ASX: A2M) has been winning a greater share of in recent years.
Is it too late to invest?
Although I think Bellamy's would be a great long-term investment, one broker that believes investors ought to keep their powder dry for the time being is Goldman Sachs.
According to a note out of the investment bank, its analysts have retained the neutral rating and $9.00 price target on the company's shares following the announcement.
Goldman sees positives from the approval such as branding and promotion opportunities in China and the option to develop an offline sales team. The latter should mean that Bellamy's is more prepared when its organic range obtains SAMR approval.
However, this isn't enough for the broker to make any changes to its recommendation just yet.
Incidentally, Goldman Sachs isn't the only broker that is neutral on Bellamy's. A note out of Morgan Stanley this morning reveals that its analysts have retained their equal-weight rating and $10.00 price target.
