Shares in goat-milk-based infant formula producer Wattle Health Australia Ltd (ASX: WHA) jumped 10% today after the business announced a deal that sees it move closer to gaining China Food and Drug Authority (CFDA) approval for its products.
The group has signed a memorandum of understanding with Blend and Pack Pty Ltd which gives Wattle's infant formula a "brand slot" to be nominated for approval by the CFDA. If accreditation is received it will represent a significant boost to Wattle Health in its ambition to grow sales in the large Chinese market.
According to the company: "It is projected that in 2018 the China market for goats' based infant formula will be around $1.9 billion an increase of 43% on 2017".
Wattle Health shares have now rocketed 855% over the past year, although the company made just $84,451 in sales for the quarter ending September 31 2017.
It's one of a number of infant formula businesses including Blackmores Limited (ASX: BKL), the a2 Milk Company Ltd (ASX: A2M) and Bellamy's Australia Ltd (ASX: BAL) all hoping to cash in on rising Chinese demand for infant formula.
