About ASIA GROCERY Company

The Group is a well-known food and beverage grocery distributor in Hong Kong, China. It has over 40 years of experience in the food and beverage grocery distribution industry since opening the first “Hung Fat Ho” grocery store in the 1970s. The Group focuses on distributing a broad portfolio of food and beverage groceries to a wide range of customers, including Hong Kong restaurants, non-commercial restaurants, hotels and private clubs, food processors and wholesalers. The Group also provides product procurement, repackaging, quality assurance, warehousing and storage, transportation and other value-added services to provide customers with one-stop food and beverage grocery distribution solutions. The Group has developed a diversified product portfolio covering over 2,100 categories of food and beverage groceries and branded and non-branded products with over [3,800] minimum inventory units. Over the track record period, the Group has produced more than [300] brand products from several jurisdictions, such as Hong Kong, China, China, Japan, Korea, Thailand, Malaysia, the United Kingdom, the United States, Spain, France, Turkey and Italy. The Group's broad product portfolio includes food products, specialty food ingredients and kitchen supplies, which can be broadly divided into (i) daily necessities and grain products; (ii) packaged foods; (iii) sauces and condiments; (iv) dairy products and eggs; (v) beverages and wine; and (vi) kitchen supplies. During the track record period and up to the last practical date, the Group procured food and beverage groceries from over 220 suppliers, including (i) food importers and wholesalers, (ii) domestic and international brand owners and manufacturers; and (iii) agents and distributors mainly based in Hong Kong, China. The directors believe that food importers and wholesalers are an important channel for the Group to procure a full range of products from around the world in a cost-effective manner. The Group also directly purchases from domestic and international brand owners and manufacturers (usually resulting in higher profits for the Group). In 2013, the Group began purchasing branded groceries directly from European brand owners. During the track record period, the Group's procurement from the five major suppliers was HK$32.8 million, HK$37.7 million and HK$9.6 million respectively, accounting for approximately 25.4%, 26.0% and 26.6% of total procurement, respectively. Purchases from the largest suppliers were HK$10.1 million, HK$12.6 million and HK$3.1 million respectively, accounting for approximately 7.9%, 8.7% and 8.5% of the total procurement volume for the same period. Up to the last practical date, the Group has established relationships with each of the five major suppliers for over three years during the track record period.