ATM - A2 Milk Corporation Limited

[Balance]

I don't think we need to worry too much about Nestle. Given the fact Dairy Farm still use "A2" label on its products, I can see "A2" word won't be exclusive used by ATM any longer. Maybe its patent has expired. However, ATM has built strong foundation in the major markets, especially in Aus and China, and it is the creator of "A2" milk.

For rivals like Nestle, it has launched "A2" products but it's hard to promote the "A2" is a better one as it still has large range of products including A1. If it said A2 is better, its products including A1 would suffer. If it didn't promote A2, just launch "A2" products, then it would actually do marketing for "A2" which ATM is a beneficiary. Because if A2 is not better, why should it launch A2 only products?

Excellent point.

Unless Nestle promotes A2 milk and infant formula as super premium - reinforces ATM position.

[Balance]

http://www.nzherald.co.nz/business/n...ectid=12028460

a2 milk faces tougher road ahead


totally agree with the article

Share price action today says the other institutions are very happy to pick up stock courtesy of Devon's PR release?

[minimoke]

Agree Nestle and Fonterra for that matter face a marketing conundrum with A2. How to promote A2 as the future without undermining their core business ?

Coke Cola seems to have no difficulty selling their "no sugar" range amongst their sugar products.

[James108]

Coke Cola seems to have no difficulty selling their "no sugar" range amongst their sugar products.

Exactly. It blows my mind that a huge competitor entering this segment with relative ease (i.e. is all their IP/patents worthless? who will enter next?) can be spun as a good thing.

I'm not saying its the end for ATM, they still have several advantages and I continue to hold but nestle entering with such ease can't be good.

[Beagle]

Coke Cola seems to have no difficulty selling their "no sugar" range amongst their sugar products.

I think we can turn this thing on its head. ATM is coke, "the real thing" and Nestle is Pepsi. How many adds have you seen for Pepsi max, the no sugar variety of Pepsi ? I can't remember a single one.

[couta1]

I think we can turn this thing on its head. ATM is coke, "the real thing" and Nestle is Pepsi. How many adds have you seen for Pepsi max, the no sugar variety of Pepsi ? I can't remember a single one.

Apparently the new Nestle Atwo product is not exactly flying off the shelves, no surprises there.

[RGR367]

For most of us who caught the big wave, circa at 40-60 cents sp, does it matter now if a competitor enters the market? It just made what we already have a treasure to hold even more, doesn't it?

[BlackPeter]

surely A2 is able to be promoted as for those with lactose intolerance , which doesn't say anything bad about A1

Promoting A2 milk for people with lactose intolerance actually would be wrong.

If people are really lactose intolerant they can digest neither A1 nor A2 milk (lactose is in A1 as well as in A2 milk). However - there are many more people who think that they are lactose intolerant, than people who really are. Most of the delta (not lactose intolerant, but still have problems digesting regular milk) just can't stomach A1 milk, but are fine with A2 milk.

So - unless you belong to the small group of people who actually are lactose tolerant , you can drink A2 milk. A sub set of these people is able as well to drink A1 milk without immediate problems.

But than, even for these people there is always the nagging feeling in the back - does the consumption of A1 milk create long term health issues (particularly for baby's and toddlers)? A number of sources claim that the consumption of A1 protein leads to increased baby mortality (sudden infant death syndrome) and increased levels of autism and diabetes.

Here is a pro-A2 webpage:https://www.authoritydiet.com/a1-vs-...its-nutrition/

and here is a more cautious assessment: https://www.healthline.com/nutrition/a1-vs-a2-milk

I haven't investigated the reliability of these sources, but if you can get A2 for your child (which is more natural anyway, human breast milk is A2), why take the risk?

[tipsy]

The Chinese are also extremely cautious about buying counterfeit products and have no concerns about paying a premium for the real deal. Atwo does sound like a knockoff of A2.

[Leftfield]

Nice to see ATM bounce back today after a pretty biased and questionable PR article from a poor performing fund posing as journalism.

To me the most questionable aspect to the article is the implication that A2's IP is weak or non existent. The reality is that it may be some years before A2 takes a legal action against Nestle, and then much will depend on whether A2 has been ‘adversely effected.’ It is simply too early to say whether at this stage there has been any adverse impact on A2.

When it comes to IP protection, think Sony, Samsung and Apple and you will appreciate litigation is a long term and expensive game, that is not to be rushed into.

For those of us who have been with ATM since the 50c days, we have seen it gain profitable market share of around 10% in Australia, and the UK against firmly entrenched opposition (much tougher than Nestle in China.) ATM has shown it doesn't need market domination. All it needs is a profitable niche.

I won't be scared out of my valuable holdings by such sham journalism and wii quietly wait till the company's next update before I make any judgements.