Financial Performance - Revenue for the first half of 2024 was RMB 44.6705 billion, a decrease of 12.6% year-on-year[2] - Gross profit margin increased by 1.9 percentage points to 40.3%[2] - Operating profit was RMB 3.1193 billion, with an operating profit margin of 7.0%, up 0.6 percentage points[2] - Profit attributable to equity shareholders was RMB 2.4458 billion[2] - Total revenue for H1 2024 was RMB 44,670,500 thousand, down 12.6% compared to RMB 51,118,523 thousand in H1 2023[12][13] - Revenue for the first half of 2024 decreased by 12.6% to RMB 44.6705 billion compared to RMB 51.1185 billion in the same period last year[53] - Gross profit margin increased by 1.9 percentage points to 40.3% due to lower raw milk prices, despite a decline in gross profit to RMB 17.9847 billion[54] - Operating profit margin improved by 0.6 percentage points to 7.0%, with operating profit declining by 4.8% to RMB 3.1193 billion[55] - EBITDA decreased by 7.5% to RMB 4.7908 billion, but EBITDA margin increased by 0.6 percentage points to 10.7%[56] - Net profit attributable to equity shareholders fell by 19.0% to RMB 2.4458 billion, with basic earnings per share dropping to RMB 0.623[56] - Capital expenditure decreased by 10.3% to RMB 1.6929 billion, primarily allocated to new and upgraded production facilities[58] - Net cash inflow from operating activities decreased by 44.4% to RMB 1.9199 billion, mainly due to lower net profit and increased raw material inventory[59] - Total interest-bearing borrowings increased to RMB 41.5623 billion, with a debt-to-equity ratio of 81.3%[60] Segment Performance - The company operates in five reportable segments: liquid milk, ice cream, milk powder, cheese, and other dairy-related businesses[11] - Segment performance is evaluated based on adjusted pre-tax profit/loss, excluding interest income, non-lease financing costs, and other items[11] - Segment assets and liabilities exclude investments in associates and other non-segment corporate assets and liabilities[11] - Liquid milk business revenue decreased to RMB 36,261,544 thousand in H1 2024 from RMB 41,640,229 thousand in H1 2023, a decline of 12.9%[12][13] - Ice cream business revenue dropped to RMB 3,371,448 thousand in H1 2024 from RMB 4,308,698 thousand in H1 2023, a decrease of 21.7%[12][13] - Segment profit for liquid milk business was RMB 2,551,326 thousand in H1 2024, down 9.5% from RMB 2,818,627 thousand in H1 2023[12][13] - Ice cream business segment profit declined 46.3% to RMB 384,750 thousand in H1 2024 from RMB 716,223 thousand in H1 2023[12][13] - Powdered milk business revenue decreased 13.7% to RMB 1,635,262 thousand in H1 2024 from RMB 1,894,213 thousand in H1 2023[12][13] - Cheese business revenue declined 6.3% to RMB 2,114,319 thousand in H1 2024 from RMB 2,256,051 thousand in H1 2023[12][13] - Liquid milk revenue accounted for 81.2% of total revenue, amounting to RMB 36.2615 billion, a decline from RMB 41.6402 billion in the previous year[60] - Revenue from ice cream products was RMB 3.3714 billion, accounting for 7.5% of Mengniu's total revenue (2023: RMB 4.3087 billion, 8.4%)[66] - Revenue from milk powder products was RMB 1.6353 billion, accounting for 3.7% of Mengniu's total revenue (2023: RMB 1.8942 billion, 3.7%)[67] - Revenue from cheese products was RMB 2.1143 billion, accounting for 4.7% of Mengniu's total revenue (2023: RMB 2.2561 billion, 4.4%)[68] Balance Sheet and Equity - Total assets as of June 30, 2024, were RMB 79.5696 billion, a decrease from RMB 81.0917 billion at the end of 2023[6] - Total liabilities as of June 30, 2024, were RMB 65.6047 billion, compared to RMB 64.5682 billion at the end of 2023[7] - Net current liabilities were RMB 512.871 million, compared to net current assets of RMB 1.5342 billion at the end of 2023[7] - Net assets increased to RMB 51.1186 billion from RMB 50.6517 billion at the end of 2023[7] - Total equity increased to RMB 51,118,603 thousand as of June 30, 2024, compared to RMB 50,651,711 thousand as of December 31, 2023[8] - Retained earnings rose to RMB 34,586,416 thousand as of June 30, 2024, up from RMB 34,064,964 thousand as of December 31, 2023[8] - Non-controlling interests increased to RMB 6,390,550 thousand as of June 30, 2024, compared to RMB 6,331,752 thousand as of December 31, 2023[8] - The company's current liabilities exceeded current assets by RMB 512,871 thousand as of June 30, 2024[9] - Total assets increased to RMB 116,723,294 thousand as of June 30, 2024, up 1.3% from RMB 115,219,951 thousand as of December 31, 2023[12][13] Shareholder Returns and Dividends - The company plans to repurchase up to HKD 2 billion worth of shares in the next 12 months[2] - The company did not declare an interim dividend for the first half of 2024, consistent with the previous year's policy[26] - Final dividend for the previous fiscal year amounted to RMB 1,924.4 million, representing RMB 0.489 per share, a 21.2% increase from RMB 0.402 per share in 2023[27] - The weighted average number of ordinary shares used for calculating basic earnings per share was 3,928,960 thousand shares in 2024, compared to 3,948,977 thousand shares in 2023[29] - The weighted average number of ordinary shares used for calculating diluted earnings per share was 3,933,283 thousand shares in 2024, compared to 3,963,703 thousand shares in 2023[31] - The company plans to repurchase up to HK$2 billion worth of shares within the next 12 months to enhance shareholder returns[75] Sustainability and Environmental Initiatives - The company continues to implement its "GREEN" strategy and "Dual Carbon" goals, focusing on sustainable development initiatives[2] - The company has established a "1+N" sustainability reporting system and released multiple reports including the "2023 Sustainability Report" and "Natural-related Financial Disclosure Report," making it the first in China's dairy industry to follow the TNFD framework[71] - The company has set quantitative goals for green packaging transformation, including reducing fossil-based virgin plastics and increasing the use of recycled and degradable materials[71] - The company has partnered with AiHuiShou to launch a "Dairy Packaging Plastic Reduction and Renewal Plan," aiming to reduce packaging waste and promote green consumption[71] - The company has become a member of RSPO and initiated sustainable palm oil procurement, while also delivering China's first "zero-deforestation" soybeans[71] Product Innovation and Market Expansion - The company launched new products such as 0-lactose milk and various flavored milk teas to cater to diverse consumer needs[36] - Mengniu's low-temperature dairy business outperformed the industry with a 20-year consecutive market share leadership, achieving continuous improvement in product structure and profitability[38] - Mengniu's low-temperature yogurt upgraded to 100% raw milk formula, with strong growth in the 0-sugar and fruit-flavored segments, driving high sales growth in 2024[38] - Mengniu's fresh milk business achieved double-digit growth for the premium brand "Daily Fresh Language," with innovative products like double-protein milk gaining market acclaim[39] - Mengniu's fresh milk business led in online and offline channels, securing the top market share in platform and fresh e-commerce, and launched the industry's first self-operated Douyin live-streaming room[39] - Mengniu's infant formula business turned profitable in H1 2024, focusing on functional nutrition and operational efficiency, with the Ruiburen brand enhancing R&D and sales channels[40] - Ruiburen released the world's first MLCT clinical results, a patented innovation in infant formula, strengthening its competitive edge[41] - Mengniu's ice cream business strengthened brand and product innovation, with the "Sui Bian" brand upgrading its product line and launching premium series to meet young consumer demands[44] - Mengniu's overseas ice cream brand, Aice, achieved strong sales growth and profitability, maintaining the top market share in Indonesia and second in the Philippines[44] - Mengniu's cheese business is positioned for long-term growth as Chinese consumers shift from "drinking milk" to "eating milk," driving the industry's transformation from rough to refined processing[45] - Miao Kelan achieved a market share of over 30% in the cheese market, maintaining its leading position[46] - Miao Kelan launched new adult-ready-to-eat nutrition cheese products in May 2024, expanding its product matrix[46] - Miao Kelan completed the 100% cash acquisition of Inner Mongolia Mengniu Cheese Co., Ltd. in June 2024 to consolidate its leadership in the cheese category[46] - Mengniu's Ruibuen led the release of the first domestic group standard for detecting 7 human milk oligosaccharides (HMOs) in infant formula and modified milk powder in March 2024[47] - Hongmo Biotechnology, a subsidiary of Mengniu, completed a nearly 100 million yuan Pre-A round of financing in May 2024[47] - Mengniu's M-Science brand became the official sports nutrition sponsor for the Chinese Triathlon National Team and major marathons[47] - M-Science launched the Fast-Endura™ energy gel series and Fast-hydro technology electrolyte products in early 2024[48] - Zhenguoli brand launched new milk tea series products targeting young consumers, featuring "zero milk powder, zero non-dairy creamer, zero trans fat"[63] - Mengniu upgraded its low-temperature yogurt products to 100% raw milk formula and expanded into the 0-sugar and fruit particle segments[64] - YouyiC low-temperature probiotic drink maintained its No.1 brand power in the industry for three consecutive years[65] - Daily Fresh brand launched innovative Double Protein Milk product, adding 6 almonds per 350mL cup[66] - Ruiburen infant formula upgraded its core product to A2 β-casein milk source in 2024[67] - Miaokelando expanded its product matrix with new adult snack cheese products and launched industry-first cheese innovations for B2B catering[68] Operational and Strategic Initiatives - The company strengthened its RTM channel strategy, enhancing dealer empowerment and online penetration[36] - The company expanded its B2B market, collaborating with brands like Yum China and Mixue Bingcheng in the foodservice sector[37] - The company provided nearly 730 million yuan in financial support to upstream partners in the first half of 2024[51] - Mengniu's "World Quality" activities attracted over 2,000 consumers to visit more than 60 factories during the 315 special event[50] - The company is focusing on R&D innovation, brand building, digital transformation, and channel optimization to drive high-quality development[73] - The company aims to lead the dairy industry into a new phase of "high-tech, high-efficiency, and high-quality" development[74] Governance and Compliance - The company adopted revised International Financial Reporting Standards (IFRS) during the period, including amendments to IAS 1 and IFRS 16[10] - The company's audit committee reviewed unaudited interim financial information for the six months ending June 30, 2024, ensuring compliance with governance standards[79] - The company's interim financial information was reviewed by KPMG, with an unmodified conclusion report included in the interim report[80] - The Board of Directors expressed gratitude to shareholders and the community for their consistent support, and acknowledged the hard work and loyalty of all employees[83] Employee and Workforce - As of June 30, 2024, the company employs over 43,000 staff across mainland China, Hong Kong, Oceania, and Southeast Asia[72] Cost and Expenses - Cost of sales decreased to RMB 26,664.1 million in 2024, down 15.3% from RMB 31,476.4 million in 2023[19] - Employee benefit expenses, including executive compensation, totaled RMB 4,204.2 million, a 5.0% decrease from RMB 4,424.1 million in 2023[19] - Current income tax expense was RMB 663.0 million, slightly lower than RMB 673.4 million in 2023[22] - Sales and distribution expenses decreased by 8.8% to RMB 12.6805 billion, accounting for 28.4% of revenue, up from 27.2% in the previous year[55] Inventory and Write-downs - Inventory write-downs surged to RMB 346.1 million in 2024, a significant increase from RMB 22.8 million in 2023[18] Government Subsidies - Government subsidies increased to RMB 285.0 million in 2024, up 9.9% from RMB 259.3 million in 2023[17] Accounts Receivable and Payable - Accounts receivable and notes, net of loss provisions, amounted to RMB 3,437,856 thousand as of June 30, 2024, a decrease from RMB 3,668,604 thousand as of December 31, 2023[33] - Accounts payable and notes totaled RMB 9,166,225 thousand as of June 30, 2024, down from RMB 9,499,441 thousand as of December 31, 2023[34] Online and Retail Channels - The company's online membership exceeded 82 million, with a significant increase in new retail membership[36] Overseas and Domestic Revenue - Overseas revenue accounted for 5.3% of total revenue in H1 2024, reaching RMB 2,351,871 thousand[15] - Mainland China revenue was RMB 42,318,629 thousand in H1 2024, representing 94.7% of total revenue[15] - Revenue from overseas markets accounted for RMB 2,121.3 million, representing 4.1% of total revenue, with ice cream contributing RMB 968.1 million (45.6% of overseas revenue)[16] Production Capacity - Mengniu has 45 production bases in China and 6 overseas, with a total annual production capacity of 13.9 million tons (December 2023: 14.04 million tons)[69]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of 15.97 HKD per share, based on a 13X PE for 2024 [3][58]. Core Views - The dairy industry is at a cyclical low, with supply-side adjustments underway. The overall demand for dairy products remains weak due to macroeconomic factors, leading to intensified price competition and promotional activities [2][11]. - The company has a solid operational foundation, with a leadership transition expected to usher in a new phase of development. The new management is experienced and familiar with the industry, which is anticipated to help navigate the current downturn [2][28]. - The company has demonstrated strong free cash flow generation capabilities, reaching a record high of 6.82 billion CNY in 2023, with an increased dividend payout ratio of 40% [2][50][56]. - Revenue and profit forecasts for 2024-2026 indicate a slight decline in 2024, followed by recovery in subsequent years, with expected revenues of 94.1 billion CNY in 2024, 98.57 billion CNY in 2025, and 102.84 billion CNY in 2026 [2][58]. Summary by Sections 1. Industry Overview - The dairy industry is experiencing a downturn, with production volumes declining and promotional activities increasing to manage inventory [2][11]. - The average price of raw milk has dropped significantly, with a year-on-year decrease of 14.4% as of August 2024 [19]. 2. Company Operations - The company has maintained its market leadership in high-end white milk and low-temperature yogurt, with a steady increase in revenue contribution from cheese products [2][32]. - The leadership transition is expected to enhance operational strategies and market positioning [2][28]. 3. Financial Performance - The company achieved a record free cash flow of 6.82 billion CNY in 2023, indicating strong cash generation capabilities [2][50]. - The dividend payout ratio has been increased to 40%, reflecting a commitment to returning value to shareholders [2][56]. 4. Revenue and Profit Forecast - Projected revenues for 2024-2026 are 94.1 billion CNY, 98.57 billion CNY, and 102.84 billion CNY, respectively, with a forecasted decline in net profit for 2024 followed by recovery [2][58].

Financial Performance - Revenue increased by 6.5% to RMB 98,624 million in 2023[5] - Operating profit grew by 13.8% to RMB 6,170.6 million, with an operating profit margin of 6.3%[6] - Mengniu achieved steady growth in revenue and a continuous increase in operating profit margin in 2023[23] - Revenue for 2023 increased by 6.5% year-on-year to RMB98,624.0 million (2022: RMB92,593.3 million)[102][106] - Gross profit rose to RMB36,640.1 million (2022: RMB32,689.8 million), with gross profit margin increasing by 1.9 percentage points to 37.2% (2022: 35.3%)[103][107] - Operating profit increased by 13.8% to RMB6,170.6 million (2022: RMB5,423.2 million), with operating profit margin rising by 0.4 percentage points to 6.3% (2022: 5.9%)[109] - Selling and distribution expenses increased by 12.7% to RMB25,192.2 million (2022: RMB22,347.3 million), accounting for 25.5% of revenue (2022: 24.1%)[104][108] - Product and brand marketing expenses surged by 36.9% to RMB7,522.7 million (2022: RMB5,495.1 million), representing 7.6% of revenue (2022: 5.9%)[104][108] - Administrative expenses increased by 6.8% to RMB4,742.5 million (2022: RMB4,441.9 million), maintaining a flat percentage of revenue at 4.8%[105][108] - Total business operating expenses increased by 11.7% to RMB30,469.5 million (2022: RMB27,266.6 million), accounting for 30.9% of revenue (2022: 29.4%)[109] - EBITDA increased by 4.2% to RMB9,506.7 million, with EBITDA margin at 9.6%, down 0.3 percentage points year-on-year[110] - Profit attributable to owners decreased by 9.3% to RMB4,809.2 million, with basic earnings per share down 9.1% to RMB1.220[110] - Income tax expenses increased by 8.2% to RMB1,425.2 million, with an effective tax rate of 22.6%, up 2.3 percentage points year-on-year[111] - Capital expenditure decreased by 17.8% to RMB4,171.8 million, with RMB4,134.7 million spent on production facilities and related investments[115] - Net cash inflow from operating activities increased by 0.2% to RMB8,349.3 million[116] - Net borrowings decreased to RMB24,967.0 million, with a debt-to-equity ratio of 73.9%, down from 78.1% in 2022[117] - Finance costs increased to RMB1,569.3 million, representing 1.6% of revenue, up 0.4 percentage points year-on-year[117] - Liquid milk revenue increased to RMB82,071.1 million, accounting for 83.2% of total revenue[123] - Revenue from the ice cream business amounted to RMB6,026.3 million, accounting for 6.1% of Mengniu's total revenue[135] - Revenue from the milk formula business was RMB3,801.7 million, representing 3.9% of Mengniu's total revenue[137] - Cheese business revenue reached RMB4,357.3 million, contributing 4.4% to Mengniu's total revenue[139] Production Capacity and Facilities - The Group's annual dairy production capacity reached 14.04 million tons as of December 31, 2023[2] - Mengniu built a fully intelligent Ningxia factory, allowing 100 people to produce an annual output of 1 million tons with a value of RMB10 billion[28] - Mengniu established a fully digitalized Ningxia factory with a capacity of 1 million tons and an output value of 10 billion yuan, marking a milestone in intelligent manufacturing[30] - Mengniu launched the world's first fully intelligent dairy factory in Ningxia, producing 1 million tons annually with a value of RMB10 billion, operated by only 100 people[97][100] - Mengniu's total annual production capacity increased to 14.04 million tons as of December 2023[142] - Mengniu expanded its production bases to include 45 in China, 2 in Indonesia, 2 in Australia, 1 in the Philippines, and 1 in New Zealand[142] - Mengniu's total production capacity reached 14.04 million tons in 2023, with 45 production bases in China and 6 overseas[146] - The Ningxia factory, a fully intelligent super factory, reduced energy consumption by 43% compared to conventional factories[148] Product Innovation and Development - Mengniu launched China's first liquid protein nutritional supplement, M-ACTION Sports Protein Drink, and independently developed human milk oligosaccharide (HMO)[9] - Mengniu's independently-developed human milk oligosaccharide (HMO) was approved by the National Health Commission, becoming the only domestic company among the first batch of approved enterprises in China[19] - Mengniu launched China's first liquid protein nutritional supplement drink under the brand M-ACTION, injecting new momentum into the Group's sustainable development[27] - Mengniu developed and commercially applied its proprietary "super ingredient" HMO (Human Milk Oligosaccharides), gaining a first-mover advantage in the nutrition frontier[30] - Mengniu successfully developed HMO (human milk oligosaccharide) and obtained approvals from Chinese regulatory authorities, becoming the first Chinese dairy company to achieve this milestone[82][84] - Mengniu launched Reeborne Enzhi series 4, the first milk formula product in China to use independently developed HMO and MLCT[82][84] - Mengniu introduced China's first liquid protein nutritional supplement, M-ACTION Sports Protein Drink, entering the sports nutrition market[85][86] - M-ACTION Sports Function Evaluation Center uses international advanced equipment to provide athletes with comprehensive testing and evaluation of sports biomechanics and physiology[85][86] - Mengniu launched a new lactose-free milk product under its parent brand in 2024 to cater to lactose-intolerant Chinese consumers[124] - Just Yoghurt launched an additive-free original flavor yogurt in 2024, featuring "zero artificial flavors, zero colorants, zero gelatin, zero milk powder" and certified by EU standards[127] - Fruit Milk Drink introduced a new series of milk tea drinks in 2024, including "Earl Gray Tea Flavor" and "Melon Oolong Flavor", with "zero added milk powder, zero added non-dairy creamer, and zero trans fatty acids"[129] - Mengniu enhanced its plain yogurt brand with the launch of Fresh Yogurt, emphasizing fresh milk sources, premium strains, and advanced processing methods[130] - YO!FINE DIARY, a premium yogurt brand, introduced Osmanthus and Water Chestnut Yogurt and Forest Avocado Yogurt, well-received by consumers[130] - Champion Jianzihao was repositioned as the "pioneer in Chinese healthcare yogurt" with products designed to boost immunity[130] - Yoyi C zero sucrose products, rich in live probiotics, promote intestinal motility and feature eco-friendly, label-free packaging[132] - Yoyi C launched a "Smooth" series with zero sucrose and zero fat, containing 5 strains of complex probiotics and 2 essential dietary fibers for intestinal health[132] - Shiny Meadow 4.0 Jersey fresh milk was launched, sourced from rare Jersey cattle accounting for only 1% of domestic stock[133] - Suibian Gold Label series introduced with high cocoa content (72% and 52%) and quality raw milk content (≥40%)[135] - Reeborne Enzhi series became the first in the world to add MLCT structured lipids[137] - Milkground launched Organic Cheese Sticks and premium leisure products like "Mousse Cheese Cup"[139] Market Share and Business Performance - Mengniu's market share in the liquid milk market continued to expand, with Milk Deluxe consistently increasing its brand equity and extending its lead in the high-end segment[25] - Mengniu's chilled-product business saw strong performance of new products, driving sales to grow against the trend and maintaining the market share first place for 19 consecutive years[25] - Mengniu's liquid milk market share continued to expand, with Milk Deluxe achieving double-digit growth in its organic series and further optimizing its product mix[44] - Mengniu's chilled product business achieved counter-cyclical growth, maintaining its market share leadership for the 19th consecutive year[57] - Mengniu's online membership exceeded 74 million, with steady growth in new retail channels and leading market share in home delivery services[55] - Mengniu's room temperature milk beverages recorded positive growth, with significant market share increases driven by new product launches[53] - Mengniu's room temperature business expanded to 26,000 townships, covering over 800,000 distribution points, enhancing market penetration in rural areas[55] - Mengniu ranked in the top eight of the 2023 "Global Dairy Top 20" list, solidifying its position as the youngest company in the global dairy industry's top ten[47] - Mengniu's room temperature pure milk sales outpaced industry growth, driven by consumer demand for nutritional health and immunity[52] - Mengniu's chilled probiotic drinks segment narrowed the gap with the leading brand, reinforcing its position as the second-largest brand in the segment[57] - Mengniu's room temperature yogurt brand, Just Yoghurt, launched a new plain yogurt meeting EU standards, emphasizing zero artificial additives[53] - Mengniu's room temperature business unit optimized its channel structure, with online sales growth solidifying its position as the top player in online sales within the room temperature product segment[55] - Yoyi C probiotic drinks adopted a proprietary probiotic strain tailored for the Chinese population, leading to significant growth in new product growth rate and improved profit structure[58][59] - Mengniu's chilled business achieved positive growth despite weak industry demand, maintaining the No.1 market share for 19 consecutive years[59] - Shiny Meadow, a high-end fresh milk brand, solidified its position as the market leader in the high-end fresh milk market, with Xiaoxianyu recording exceptional annual sales growth in the mid-to-high end fresh milk market[61][64] - Shiny Meadow upgraded to 4.0 fresh milk using 1nm micro-membrane freshness-locking technology, locking in 4.0g of fresh milk protein and preserving nutrients[62][64] - Mengniu's basic fresh milk consistently held the top market share in the basic fresh milk segment for three consecutive years[63][64] - Mengniu's fresh milk business maintained its leadership in both online and offline channels, ranking No.1 in market share at major retailers and e-commerce platforms[65] - Mengniu's domestic infant formula business focused on the Reeborne brand, with the Reeborne Enzhi series driving strong growth in online sales[67][68] - Bellamy's achieved strong growth in sales, maintaining its position as the No.1 cross-border e-commerce brand for organic milk formula[69] - Yourui's high-end adult milk formula products were upgraded with a new formula including whey protein, calcium citrate, MLCT, and a combination of vitamins and minerals[70] - Mengniu's ice cream business continued to innovate and upgrade its brands, exploring novel consumption scenarios and raising product influence and brand reputation[71] - Bellamy achieved strong sales growth by enhancing brand operations, price management, channel execution, and supply chain efficiency, maintaining its position as the top organic infant formula brand in cross-border e-commerce[72] - Bellamy expanded its product portfolio with new organic offerings, including walnut oil, flaxseed oil, and baby noodle series, while also expanding into new cross-border channels like Aiyingshi and Hema[72] - Suibian reinforced its leadership in the chocolate ice cream market with its billion-level bestseller, the Strawberry Soft Core Crispy Skin ice cream, and expanded its brand influence through collaborations with top IPs like Universal Studios[74] - Deluxe, Mengniu's premium brand, underwent a significant rebranding, focusing on purity and taste, and launched ten new products across three series, including cross-brand collaborations with Maotai[74] - The ice cream business division strengthened its store expansion and market coverage, focusing on key urban markets and accelerating expansion into county and township markets, leading to a year-on-year increase in end-market coverage[75] - Aice, Mengniu's overseas ice cream brand, ranked number one in market share in Indonesia and number three in the Philippines, with strong growth in overall sales revenue and profit margins[77] - Milkground continued to rank first in domestic cheese market share, launching new products like "Organic Cheese Sticks" and "Golden Cheese Sticks," and expanding into new product categories targeting urban white-collar workers and families[79] - Mengniu's cheese business focused on expanding into the catering sector, launching its first in-house produced light cream and pioneering the first domestically produced fermented butter in China[81] Sustainability and ESG - Mengniu's MSCI ESG rating was elevated to AA, making it the only comprehensive dairy company in China to achieve this rating[12] - Mengniu's MSCI ESG rating was upgraded to AA, the highest rating in the industry[18] - Mengniu adopted a series of measures under its "GREEN" sustainable development strategy, including signing up to join the global initiative to grow, restore and conserve one trillion trees with the World Economic Forum[29] - Mengniu received the highest "AA" rating among Chinese integrated dairy companies in the MSCI ESG rating[29] - Mengniu achieved an "AA" rating in MSCI ESG, the highest among Chinese dairy companies, reflecting its commitment to sustainability[30] - Mengniu implemented 15 specific carbon reduction measures as part of its "GREEN" sustainable development strategy[143] - Mengniu has planted 97 million trees in the Ulan Buh Desert, turning over 200 square kilometers of desert into an oasis[144] - Mengniu achieved a carbon reduction of more than 180,000 tons in its upstream pastures through various emission reduction measures[145] - Mengniu built 30 national-level green factories, with the Qujing factory achieving carbon neutrality for two consecutive years[148] - Mengniu launched a variety of carbon-neutral and green low-carbon products in the downstream market[149] - Mengniu's MSCI ESG rating was upgraded from A to AA, making it the only comprehensive dairy company in China with an AA rating[151] - Commitment to lead the dairy industry towards "carbon neutrality" under the "Greener" strategy[160] Digital Transformation and Innovation - The Group completed the construction of the world's first fully intelligent dairy factory and introduced MENGNIU.GPT and the "WOW Health+" platform[11] - Mengniu successfully released the world's first model focused on nutrition and health, MENGNIU.GPT, and implemented it in the digital intelligent nutrition and health management platform, WOW Health+[28] - Mengniu released MENGNIU.GPT, the world's first AI model focused on nutrition and health, integrated into its digital health management platform WOW Health+[30] - The company introduced the AI-driven digital intelligence dual flywheel strategy, upgrading digital capabilities across the supply and consumption chains[98][100] - Mengniu.GPT, the world's first nutrition and health model, was launched, alongside the "WOW Health+" platform, providing personalized health services[99][100] - Aim to achieve full digitalization across the entire industry chain from feeding to consumer terminals under the "Smarter" strategy[160] Corporate Governance and Leadership - Mr. Gao Fei, aged 47, was appointed as the CEO and executive director of the company on 26 March 2024, bringing extensive experience in sales, marketing, and business operations within the dairy industry[167] - Ms. Wang Yan, aged 45, was appointed as an executive director in December 2021, with a background in human resources management and talent development[168] - Mr. Zhang Ping, aged 59, served as an executive director from December 2021 to 26 March 2024, with over 33 years of experience in the fast-moving consumer goods industry, specializing in finance, audit, and risk control[169] - Mr. Chen Lang, aged 58, was appointed as a non-executive director and chairman of the board in April 2019, with a strong background in corporate leadership and strategy across various industries[171] - Mr. Wang Xi, aged 40, was appointed as a non-executive director in December 2021, with expertise in strategy, direct investment, and M&A, currently serving as the deputy director of the Strategy Department at COFCO Corporation[174] - Mr. Simon Dominic Stevens led the UK business of Arla Foods to grow from £500 million to £2.5 billion, achieving the No. 1 position in FMCG from No. 4 in dairy[176] - Mr. Simon Dominic Stevens successfully navigated the MENA business through COVID-19, delivering high growth for key brands and maintaining a safe environment for 3,000 employees[176] - Mr. Li Michael Hankin has over 30 years of experience in financial and accounting, fundraising, mergers and acquisitions, restructuring, and international business development[179] - Mr. Li Michael Hankin served as an independent non-executive director of COFCO Joycome Foods Limited, where COFCO Corporation holds a 29.10% interest[179] - Mr. Li Michael Hankin has held key positions in several Hong Kong-listed companies, including GCL-Poly Energy Holdings Limited and Newton Resources Limited[179] - Mr. Luo Yan, aged 62, is currently a vice president and the head of chilled product business unit and fresh milk business unit of the Group, with 30 years of experience in the food industry[186][187] - Mr. Yan Zhiyuan, aged 41, is currently a vice president and the head of milk formula business unit, leading the room temperature sales management team to achieve continuous high growth in sales revenue and market share[188][189] - Mr. Han Jianjun, aged 50, is currently a vice president and the head of the ice product business unit of the Group, leading the ice products business unit to achieve growth of over 100% for three consecutive years[190] - Mr. Zhao Jiejun, aged 47, is currently a vice president and the head of milk sourcing and animal husbandry industry chain business unit of the Group, with almost 20 years of experience in dairy industry[191] - Mr. Wen Yongping, aged 49, is the Vice President and Head of Research and Development and Innovation at the Group, with extensive experience in production and operations management, milk sources management, and core business operation management[192][194] - Mr. Yang Zhigang,

Investment Rating - The report maintains a "Buy" rating for Mengniu Dairy (2319.HK) with a target price of HKD 21.62, based on a current price of HKD 17.32 [1]. Core Views - Mengniu Dairy reported a revenue of RMB 98.62 billion for 2023, representing a year-on-year growth of 6.5%, and an operating profit of RMB 6.17 billion, up 13.8% year-on-year. The company declared a final dividend of RMB 0.489 per share, with a payout ratio of 40% for the year [2]. - The liquid milk segment showed steady growth, with revenue of RMB 82.1 billion (+4.9%), while ice cream and cheese segments saw significant increases in revenue, with cheese revenue soaring by 230% due to the consolidation of Miaokelando [2]. - The decline in raw milk prices has improved profit margins, with a gross margin of 37.2%, up 1.9 percentage points year-on-year. The operating profit margin increased to 6.3%, a rise of 0.4 percentage points [2]. - The new president, Gao Fei, is expected to lead the company towards continued improvement in profitability, supported by a favorable raw milk price environment and product structure optimization [2]. Summary by Sections Financial Performance - In 2023, Mengniu Dairy achieved a total revenue of RMB 98.62 billion, with a growth rate of 6.5%. The net profit attributable to shareholders was RMB 4.81 billion, reflecting a decline of 9.31% year-on-year. The earnings per share (EPS) for 2023 was RMB 1.22 [3][11]. - Forecasts for 2024-2026 predict net profits of RMB 5.50 billion, RMB 6.00 billion, and RMB 6.52 billion, respectively, with corresponding EPS of RMB 1.40, RMB 1.53, and RMB 1.66 [2][3]. Segment Analysis - Liquid Milk: Revenue is expected to grow at rates of 4%, 3%, and 2.8% from 2024 to 2026, driven by market share expansion and product optimization [7]. - Ice Cream: Anticipated revenue growth rates of 15%, 13%, and 10% from 2024 to 2026, supported by new consumption scenarios and innovative products [7]. - Cheese: Revenue growth is projected at 18%, 15%, and 12% for the same period, with Miaokelando maintaining a leading market share [7]. Valuation and Investment Recommendation - The report suggests a dynamic PE of 14 times for 2024, leading to a target price of HKD 21.62, maintaining the "Buy" rating based on expected improvements in operating profit margins [2][8].

海 外 研 证券研究报告 究 ＃industryId＃ 食品饮料行业 ＃02319 .HK ＃蒙dy牛Com乳pa业ny＃ 港股通（沪、深） dyStockco ＃inve 买stSu 入ggest ion＃ ( i维nv＃ e持stS ） d e＃ 新消 费趋 势引领产＃品tit创le＃新 ，营收稳健增长 uggesti onC han ＃createTime1＃ 2024年 03月 28日 ge＃ 投资要点 公 ＃市场ma数rk据et Data＃ ＃summary＃ 司 ⚫ 营收稳健增长。2023年，公司营收为986.24亿元，同比增长6.5%，增速 日期 2024.03.28 跟 同比+1.5pcts。其中液态奶营收820.71亿元，同比增长4.9%，占比83.2%， 收盘价（港元） 16.80 同比-1.3pcts。冰淇淋营收60.26亿元，同比增长6.6%，占比6.1%，同比 踪 总股本（亿股） 39.35 +0.01pcts。奶粉营收38.02亿元，同比减少1.6%，占比3.9%，同比-0.3pcts。 报 总市值（亿港元） 661.13 奶酪营收为43.57亿元，占比4.4%，同比+3.0pct ...

公司研究 | 动态跟踪 蒙牛乳业 02319.HK 液奶稳健增长，持续受益原奶成本下行与 买入（维持） 产品结构升级 股价（2024年04月02日） 17.32港元 目标价格 25.42港元 52周最高价/最低价 33.41/16港元 总股本/流通H股（万股） 393,529/393,529 H股市值（百万港币） 68,159 核心观点 国家/地区 中国 行业 食品饮料 ⚫ 核心业绩表现：公司近期发布2023年业绩公告，2023年实现营收986.24亿元 报告发布日期 2024年04月03日 （yoy+6.5%），实现归母净利润48.09亿元（yoy-9.3%）。2023年，公司毛利率 为37.2%（yoy+1.85pct），主要系原奶价格同比下降，产品结构同比提升。公司销 1周 1月 3月 12月 售费用率为25.5%（yoy+1.4pct），主要由于线下销售推广执行活动增加所致。 绝对表现% -8.65 -11.9 -12.79 -45.43 2023年公司应占联营公司业绩为0.91亿元，同比-78%。 相对表现% -10.53 -13.96 -13.64 -28.43 ⚫ 液态奶市场份额持续扩张，夯实高 ...

研究报告Research Report 2 Apr 2024 蒙牛乳业 China Mengniu Dairy (2319 HK) 2023 年业绩点评：OPM 提升稳定兑现，非经常性损益使净利波动 OPM Increased Steadily, and One-Time Profit and Loss Made Net Profit Fluctuate [观Ta点bl聚e_焦yem Inevie1s] tment Focus [Table_Info] (Please see APPENDIX 1 for English summary) 维持优于大市Maintain OUTPERFORM 事件：2023年公司营收986.2亿元，同比+6.5%（内生+2.6% ）；经 评级 优于大市OUTPERFORM 营利润61.7亿元，同比+13.8%；归母净利润48.1亿元，同比-9.3%。 现价 HK$16.80 2023H2 营收 475.1 亿元，同比+5.9%（内生+2.3%）；经营利润 29.0 目标价 HK$29.80 亿元，同比-0.3%；归母净利润17. 9亿元，同比+15.3%。 HTI ESG 2. ...

2024 年 4 月 2 日 公司动态 蒙牛乳业（2319.HK） 证券研究报告 食品饮料 平稳收官，提高分红 投资评级： Xx 买入 xx 蒙牛2023年收入986亿/+6.5%，经营利润61亿/+6.3%，经营利润率同比提升0.4pct， 完成年初目标。净利润48.8亿/-5.7%。公司变更总裁，但是表明战略目标不变，同 目标价格： 27.2 元 时提高了派息率至40%。我们预期24/25/26年净利润分别为53.9/59/63亿人民币， 现价(2024-3-28)： 16.8港元 对应EPS为1.47/1.61/1.73港元。维持“买入”评级，目标价为27.2港元，较当 前股价有62%的上涨空间。 报告摘要 总市值(百万港元) 66,112.91 液态奶平稳增长，结构持续升级。23年液态奶收入820亿/+4.9%，经营利润61亿， 流通市值(百万港元) 66,112.91 利润率7.5%/+0.2pct。特仑苏份额持续提升，有机系列双位数增长，品类结构持续 总股本(百万股) 3,935.29 优化。常温酸奶仍然承压，乳饮料基本持平。低温酸奶实现逆势增长，继续蝉联市 流通股本(百万股) 3,935.29 ...

Investment Rating - The report maintains a "Buy" rating for Mengniu Dairy (2319.HK) with a target price of HKD 21.1, representing a potential upside of 23.5% from the current price of HKD 17.1 [6][15]. Core Insights - Mengniu's revenue growth faces challenges due to industry demand slowdown, oversupply of raw milk, and intensified competition. Recent management changes may lead to short-term market sentiment fluctuations, but the company's strong product development and innovation capabilities in the liquid milk sector support long-term growth potential [5][6]. - The forecast predicts a compound annual growth rate (CAGR) of approximately 14% for the net profit attributable to shareholders from 2023 to 2026, driven by continuous margin expansion [5]. Financial Performance Summary - **Revenue Forecast**: - 2022: RMB 92,593 million - 2023: RMB 98,624 million (YoY growth of 6.5%) - 2024: RMB 100,836 million (YoY growth of 2.2%) - 2025: RMB 105,095 million (YoY growth of 4.2%) - 2026: RMB 109,810 million (YoY growth of 4.5%) [10][12]. - **Net Profit Forecast**: - 2022: RMB 5,303 million - 2023: RMB 4,809 million (YoY decline of 9.3%) - 2024: RMB 5,467 million (YoY growth of 13.7%) - 2025: RMB 6,291 million (YoY growth of 15.1%) - 2026: RMB 7,163 million (YoY growth of 13.9%) [10][12]. - **Profitability Metrics**: - Gross Margin: Expected to improve from 35.3% in 2022 to 38.0% by 2026 - Operating Margin: Expected to increase from 5.9% in 2022 to 7.3% by 2026 - Return on Equity (ROE): Projected to rise from 15.1% in 2022 to 13.3% by 2026 [10][12]. Growth Drivers - Key growth areas identified for 2024 include: - Continued strong growth for the premium product "Te Long Su" - Positive expansion trends in ice cream sales overseas - Significant revenue growth for Bellamy's, with over 40% YoY increase in 2023 - Recovery in low-temperature yogurt sales after a significant decline - Fresh milk expected to contribute to revenue growth above the company average [5][10].

Investment Rating - The report maintains a "Buy" rating for Mengniu Dairy (2319.HK) [3] Core Views - Mengniu Dairy's 2023 annual report shows a stable operating performance with a revenue of 98.624 billion yuan, a year-on-year increase of 6.51%, while net profit decreased by 9.31% to 4.809 billion yuan. The second half of 2023 saw revenue of 47.506 billion yuan, up 5.87%, and net profit increased by 15.28% to 1.789 billion yuan [2] - The liquid milk business remains robust, while the milk powder segment is undergoing adjustments. Revenue from liquid milk, ice cream, milk powder, cheese, and other dairy products for 2023 was 82.071 billion, 6.026 billion, 3.802 billion, 4.357 billion, and 2.368 billion yuan respectively, with notable growth in cheese products due to the consolidation of Miao Ke Lan Duo [2] - The company is focusing on optimizing channel layouts and quality development, with expectations for steady revenue growth in 2024. The decline in raw milk prices is anticipated to enhance gross margins, while marketing efficiency is expected to improve [2] Summary by Sections Financial Performance - In 2023, Mengniu Dairy achieved a gross margin of 37.15%, an increase of 1.85 percentage points year-on-year, primarily due to declining raw milk prices and product structure optimization. The sales expense ratio rose to 25.54%, up 1.41 percentage points, reflecting increased brand promotion activities [2] - The company forecasts net profits of 5.497 billion, 6.107 billion, and 6.631 billion yuan for 2024, 2025, and 2026 respectively, with corresponding EPS of 1.40, 1.55, and 1.69 yuan. The current stock price corresponds to P/E ratios of 11, 10, and 9 for 2024-2026 [2][7] Market Data - The total share capital is 3.935 billion shares, with a total market capitalization of 661.13 billion HKD. The stock price has fluctuated between 16.00 and 34.55 HKD over the past year [4][5]