The group also owns chemical, property, banking and insurance businesses. Its subsidiary New Hope Investment is the biggest shareholder of China Minsheng Banking, the largest private bank on the mainland.

The banking business is a natural cash cow under the administered-interest- rate regime that stipulates a spread between lending and deposit interest rates, and the property market has been sizzling in the past few years.

But Liu said the group would give top priority to the agricultural business in the next few years and invest half of the cash the group generates every year in this sector.

'China's rural market is transforming. Enormous opportunities are brewing,' said Liu. 'Competition is set to be fiercer with the entrance of more and more foreign and domestic investors. However, this is not a war to be won simply by owning massive capital or advanced technologies,' said the 59-year-old teacher-turned-entrepreneur.

Agriculture on the mainland used to be simple, with 200 million rural households planting crops and vegetables and raising poultry and pigs on blocks of land usually smaller than one hectare.

But as urbanisation sets in, farmers are flooding the cities as migrant workers, turning from farm producers to consumers of agricultural products - and expanding demand and shrinking supply. 'Urbanisation makes it possible for large-scale stock-raising and cultivation. The farmers who stay home form small companies or co-operative organisations to work together and share returns and risks. We provide them capital, technology, stud animals and markets for their products,' he said.

The advantages of New Hope, compared with foreign investors, are 'knowing the Chinese culture', being 'trusted by farmers' and 'an extensive network organising production and providing technological and financial supports after 30 years of development', says Liu.

In 2003, Innobiz Capital investment fund, owned by Hong Kong's former health, welfare and food secretary Yeoh Eng-kiong, invested in Beijing Deqingyuan Agriculture Technology, China's largest egg producer. About two years later, the World Bank's International Finance Corporation invested US$3 million in the egg production firm for a 19 per cent stake. US-based investment bank Goldman Sachs in 2008 acquired full control of more than 10 pig farms on the mainland for as much as US$300 million.

Earlier this year, a multinational consortium led by the US-based private equity Blackstone invested US$600 million in a vegetable logistics park in Shandong, a major source of vegetables on the mainland.

New Hope's theatre of activity reaches beyond the agriculture business, Liu said. It has set up 20 guarantee companies to secure loans for co-operatives and companies owned by farmers. It also has more than 7,000 employees working in fields to teach farming technologies. With these, the company aims to form bonds with farmers, said Liu.

While the inflation rate stirs up fears of consumer prices rising this year, agriculture stocks are becoming hot picks. The company's Shenzhen-listed arm, New Hope Agriculture, rose by the 10 per cent daily trading limit seven sessions in a row last month.

Liu said he was confident the company would turn good profits this year and the prospects are good for the next year. The listed company expects 1.07 billion yuan of net profits this year, an increase of 145 per cent from last year.