China’s richest man: Nongfu Spring Chairman Zhong Shanshan. And rather than Alibaba and Ant, it’s Nongfu that is helping to mint a new crop of billionaires at the end of a pandemic year full of surprises.
Zhong is worth $78 billion on the Forbes Real-Time Billionaires List today. That makes him the No. 1 richest person in China, No. 8 in the world, No. 1 in Asia, and nearly $20 billion richer than Ma, if you optimistically assume Ant’s recent IPO valuation eventually sticks and Ma’s wealth benefits.
Zhong’s fortune has rocketed with the Sept. 8 listing of his main business, Nongfu Spring, which controls about a quarter of China’s bottled water market. From their IPO price of HK$21.50, they ended today at HK$54.90. His more than 80% stake limits Nongfu’s trading liquidity, yet select global investors have gotten in. Funds associated with Fidelity International, Coatue Management and ORIX Asia Capital have profited from the stock’s rise.
Zhong’s fortune also got a big bump this year from an IPO by Beijing Wantai Biological Pharmacy Enterprise at the Shanghai Stock Exchange. Its shares were trading at 195.27 yuan this morning compared with its IPO price of 8.75 yuan in April, in part of hopes it can develop a COVID vaccine with partner GlaxoSmithKline. Nearly $10 billion of Zhong’s fortune comes from his holding in Wantai, a business he chairs.
In the same way that Ma has a colorful early history as a humble English teacher, Zhong has one, too, once reportedly having worked in construction and journalism. He set up the predecessor company to Nongfu in 1996. Zhong’s flagship is headquartered in the same city as Alibaba, Hangzhou.
Rather than the expected wave of new billionaires from Ant’s IPO capping off the year, it’s Nongfu that is instead generating new billionaires and billionaire families in China. Lu Xiaowei, an elder sister of Zhong’s wife Lu Xiaoping, Zhong Xiaoxiao, a younger sister of Zhong Shanshan, Lu Cheng, an elder brother of Zhong Shanshan’s wife, and Lu Xiaofu, another sister of Zhong Shanshan’s wife, all have holdings worth more than $1 billion, according to ownership figures in Nongfu’s prospectus. Three sons of deceased Hong Mengyue – an earlier executive – hold a combined $2 billion of shares. A sister-in-law of Zhong Shanshan’s wife – Lu Xiaozhen—also shares a billion-dollar fortune with her son and daughter.
China needs healthy tech companies to help achieve its economic growth goals and global ambitions, so it’d be an investment mistake to count its tech giants out for good. Yet it’d also be a mistake to overlook homegrown brands such as Nongfu, as a likely easing of the global pandemic next year fuels faster consumer spending in the country.
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