Only reinforces what a strong first half A2M had. Health and...

Only reinforces what a strong first half A2M had. Health and Happiness are Biotime who bought Swiss for $2B a couple of years ago.

Hong Kong-listed Health & Happiness, a competitor to locally listed infant milk formula makers Blackmores, a2 Milk and Bellamy’s, has flagged several issues in the industry at the release of its latest results.

Its shares in Hong Kong sank by 10 per cent on its results and commentary, what Morgan Stanley analyst Thomas Kierath says could also pose issues for its locally listed peers.

H&H said its daigou channel had been negatively impacted from cross-border-ecommerce laws enacted on January 1, what could potentially indicate a pull forward in ordering ahead of the changes in the December half.

In addition, it expected competition in the Chinese infant milk formula market to increase given ongoing birth rate decline, weak macro and stricter macro environment.

“Globally, commentary on Daigou sales trends haven’t been conclusive as yet, but should a slowdown become a trend, we think A2M, BA Land BKL shares would de-rate,especially if there was a December quarter pull forward,” Mr Kierath said.

A2M last up 1.11pc, BAL down 0.73pc, BKL up 0.15pc.