The Bellamy's Australia Ltd (ASX: BAL) share price has posted an unbelievable rise in 2015.
In fact, since the infant formula maker first offered its shares on the ASX in August 2014, the shares have risen an incredible 1,221% – from $1 to $12.21.
The catalyst for Bellamy's enormous share price rise is the insatiable demand for quality organic baby formula from China and other Asian countries. When Bellamy's shares first hit the ASX boards last year, the company could barely keep pharmacies and supermarkets stocked up. Since then, it's only gotten worse.
Now, hoards of 'customers' can be spotted scouring local supermarkets, pharmacies and online stores, seeking 'white gold'. Given the shortage of supply, these 'customers', or "daigou" (translated to "buyer's agent") as they're called, then on-sell the products via Chinese social media channels.
Bellamy's, Karicare and A2 MIK FPO NZ (ASX: A2M) are the most highly sought-after brands. Here's a screenshot I caught last month:
@TMFKinga, no bubble here 😉 pic.twitter.com/nx3gY9y14l
— Owen Rask 🇦🇺 (@OwenRask) November 10, 2015
It's easy to see how these 'buyers' agents' are believed to make $100,000 per year.
Can Bellamy's share price be stopped?
Bellamy's isn't the only company benefitting from the long-term tailwinds provided by a surging Chinese middle-class population. A2 Milk, Blackmores Limited (ASX: BKL) and Capilano Honey Ltd (ASX: CZZ) are but some of Australia's best companies that'll seek to tap into the demand.
With such high demand for its products, I'm not prepared to bet Bellamy's share price will fall anytime soon, but I'm not a buyer of its shares either. I'm now looking for other ways to play into China's rising demand for quality Australian-made products.
