Summary of the Conference Call on the Dairy Industry Industry Overview - The dairy sector is experiencing a rebound due to a decrease in feed costs, with companies like YouRan, New South Wood, and Gongji Dairy reporting a 10% year-on-year decline in sales costs, which has helped offset the impact of falling prices per ton. The gross profit margin for raw milk has increased by nearly 2 percentage points [1][4]. Key Points and Arguments - **YouRan Dairy Performance**: In the first half of 2025, YouRan's raw milk revenue grew approximately 8% to 8 billion yuan, driven by increased sales volume and the launch of three new farms. Sales costs decreased by 10%, and feed costs fell by 12%, leading to a gross margin increase of 2.4 percentage points. The reduction of heifer stock and an increase in the proportion of breeding cows also contributed to profit growth [1][5]. - **Modern Dairy Performance**: Modern Dairy has reduced its stock by about 20,000 heads to 18,700 heads by eliminating inefficient cows. Raw milk revenue remained stable at around 5 billion yuan, but the average selling price fell by 10% year-on-year. The solutions business revenue dropped by 23%. Despite a 23% increase in operating cash flow, net profit attributable to shareholders decreased due to biological asset losses [1][6][7]. - **Milk Price Trends**: In early September, milk prices slightly rebounded, ending a downward trend since April, indicating that demand is not as weak as expected. If milk prices stabilize in the fourth quarter, demand may stabilize next year. However, a significant reduction in breeding cow stock is anticipated due to mass culling, which may lead to a supply gap [1][8][10]. - **Supply and Demand Dynamics**: The dairy sector's stock structure has improved, with the proportion of breeding cows increasing by 2.3 percentage points to 53%. Major dairy companies have accelerated stock reduction, with Modern Dairy's heifer stock decreasing by over 20,000 heads [2][9]. - **Impact of Feed Prices**: The price of silage is expected to remain stable or slightly increase, which will affect overall milk prices. Unlike last year, silage prices have not further declined, which may impact the profitability of dairy farmers [12]. - **Meat Cycle Influence**: The meat cycle plays a crucial role, with companies like YouRan and Modern Dairy culling about 30% of their breeding cows annually. The income from culling has nearly doubled in the first half of 2025. The domestic beef supply gap is expected to continue until 2027 due to various market pressures [13]. - **International Market and Policy Changes**: The international market is seeing a decline in production from major exporters like Brazil and New Zealand due to drought and rising costs. Domestic policies are also tightening import regulations, which will increase transportation costs and affect the supply chain [14]. - **Profitability Outlook**: The reversal in milk prices and reduction in unit costs are expected to significantly enhance the profitability of dairy companies. If raw milk prices rebound and unit costs remain stable, leading companies could see gross margins improve by up to 10 percentage points [15]. Additional Important Insights - **Future Trends in Dairy Industry**: The current rebound in milk prices suggests better-than-expected demand. The supply side is also expected to perform well, with significant culling and replenishment of breeding cows. Valuation metrics indicate strong potential for profitability and growth in the dairy sector, with historical price-to-book ratios suggesting room for upward movement [16].

Investment Rating - The industry investment rating is optimistic [1] Core Viewpoints - The beef import market is characterized by high concentration, dominated by South America and growing imports from Australia [4][18] - In the first half of 2025, China's beef imports are expected to decline in volume but increase in price, with a total import of 1.3 million tons, a year-on-year decrease of 9.5% and an average price of 18.39 yuan per jin, an increase of 8.4% [4][40] - Import policies are tightening, with increased tariffs and stricter qualification requirements for importers, particularly affecting U.S. beef imports [4][59] Summary by Sections 1. Major Beef Import Countries - The top six countries accounted for over 93% of total beef imports in 2023-2025H1, with Brazil leading at 46%, followed by Argentina and Australia [4][14] - Australia has become the third-largest beef supplier to China, benefiting from the China-Australia Free Trade Agreement and U.S.-China trade tensions [4][26] 2. Changes in Beef Imports - In the first half of 2025, China's beef imports are projected to decrease in volume while prices rise, reflecting a tightening supply from overseas and an upgrade in domestic consumption [4][40] - The average price of imported beef has increased due to tightening global supply, reducing the price advantage of imported beef over domestic products [4][42] 3. Investment Recommendations - With the expected decline in import volumes and tightening import policies, domestic beef prices are likely to rise, benefiting high-quality livestock companies [4][59] - Companies such as YouRan MuYe, Modern MuYe, and China Shengmu are recommended for their potential to capitalize on rising beef prices [4][59]

Core Insights - The importance of the "14th Five-Year Plan": The upcoming "14th Five-Year Plan" is expected to significantly impact China's economic and social development over the next five years, shifting focus from production to a balance between production and consumption due to the current issue of insufficient effective demand [1] - Strengthening consumption policies: Starting in 2024, consumption policies will be significantly enhanced, including the allocation of special government bond funds to support consumption upgrades. Continued funding is expected in 2025 and 2026 [1] - Potential of service consumption: China's service consumption still lags behind developed economies, indicating a substantial opportunity for growth in this sector to stimulate consumer interest and optimize the consumption environment [1] - Rise of technology consumption: With a rapid technological development and an engineering talent surplus, products like robotic vacuum cleaners and drones are gaining market attention, likely creating new consumer demand [1] - Optimization of the overall consumption mechanism: Measures such as consumption tax reform will encourage local governments to transition from production-oriented to service-oriented, promoting the internationalization of quality consumption companies and enhancing residents' consumption capacity [1] Investment Recommendations - Food and Beverage: Recommended companies include Dongpeng Beverage and Lihigh Food, with a focus on Youran Dairy and Bairun Co [2] - Service Sector: Recommended companies include Guming, Mixue Group, and Bubugao, with a focus on Zhongsheng Holdings [2] - Light Industry: Companies to watch include Hengfeng Paper and Xilinmen [3] - Trendy Toys: Recommended companies include Pop Mart and Blokus [4] - Home Appliances: Recommended companies include Midea Group, Haier Smart Home, TCL Electronics H, Roborock, and Ecovacs, with a focus on Yingshi Innovation [5] - Agriculture: Recommended companies include Zhongchong Co, Petty Co, Muyuan Foods, and Haida Group [11] - Textile and Apparel: Recommended companies include Anta Sports, Xtep International, 361 Degrees, and Hailan Home, with a focus on Li Ning and Sanfu Outdoor [11] Report Content Analysis - Expanding consumption share: The report emphasizes that expanding consumption share is essential for achieving Chinese-style modernization, as China's consumption rate is significantly lower than that of developed countries [9] - Shift in fiscal spending: During the "14th Five-Year Plan" period, fiscal spending will shift from material investments to human capital investments, increasing support for education, healthcare, and housing [9] - Promotion of common prosperity: The report highlights the need for income distribution reform and the promotion of the Zhejiang common prosperity model to achieve balanced development [9] - Consumption tax reform: The report suggests that consumption tax reform will help local governments transition from production-oriented to service-oriented, enhancing the consumption environment [9] - Transition from traditional to new consumption: The report analyzes the maturation of traditional consumption markets and the rise of new consumption, which is characterized by a focus on quality and personal satisfaction [9] - Stimulating interest in service consumption: The report indicates that the shift from physical to service consumption is crucial for expanding domestic demand, with growing demand for events and performances benefiting local consumption [9]

Investment Rating - The report maintains a "Positive" investment rating, emphasizing the resilience of leading companies and the valuation recovery opportunities in the livestock and restaurant chains [5]. Core Insights - The report highlights that national beer companies have shown stable revenue and profit performance, while regional companies exhibit better elasticity in performance. The cost decline has contributed to gross profit growth, and the improvement in expense ratios is gradually releasing profitability [5][24]. - In the snack food sector, the report notes a divergence in channel performance, with emerging channels like bulk snacks and membership supermarkets maintaining high momentum, while traditional channels face challenges. The focus is shifting from revenue growth to profitability logic [25]. - The restaurant chain sector is experiencing a bottoming out of fundamentals and sentiment, with a gradual recovery expected as policies adjust and consumption peaks approach. The report suggests focusing on undervalued companies like Haidilao and Guangzhou Restaurant [29][31]. - The livestock sector is anticipated to see a fundamental reversal as raw milk prices stabilize and beef prices rise, which could significantly enhance profitability for companies like China Shengmu [36][45]. Summary by Sections Beer - National beer companies have demonstrated operational resilience, with stable revenue growth driven primarily by volume recovery. Regional companies like Yanjing and Zhujiang Beer have shown stronger revenue performance [12][13]. - Cost improvements from raw material price declines and stable pricing have driven gross margin increases for beer companies. The report anticipates continued upward potential in the beer sector as terminal demand gradually recovers [18][24]. Snack Foods - The snack food sector is characterized by a split in channel performance, with new channels like bulk snacks and membership supermarkets thriving, while traditional channels face challenges. The report emphasizes the importance of profitability over revenue growth moving forward [25][26]. - Companies like Wancheng Group and Yuyuan Foods are highlighted for their strong performance in emerging channels, while others are advised to focus on cost optimization to enhance profitability [25][26]. Restaurant Chains - The restaurant sector has been under pressure due to policies and competition, but a recovery is expected as restrictions ease and consumption peaks. The report suggests focusing on companies with low valuations and potential for recovery, such as Haidilao and Green Tea Group [29][31]. - The report notes that the overall restaurant revenue for H1 2025 was 2.75 trillion yuan, reflecting a 4.3% increase, but with high-end dining facing significant challenges [29][30]. Livestock - The livestock sector is expected to see a turnaround as raw milk prices stabilize and beef prices rise, which could significantly enhance profitability for companies like China Shengmu. The report indicates that the most challenging phase for livestock companies may be over [36][45]. - The report highlights that the decline in raw milk prices has pressured revenue, but a stabilization is anticipated, which could improve the valuation of biological assets and overall profitability [36][38].

China Youran Dairy Group Limited 中國優然牧業集團有限公司 (Incorporated in the Cayman Islands with limited liability) （於開曼群島註冊成立之有限公司） （Stock Code 股份代號：9858） NOTIFICATION LETTER 通知信函 Dear Non-Registered Shareholders(Note 1) , China Youran Dairy Group Limited (the "Company") – Notice of publication of (i) 2025 Interim Report, and (ii) Circular in relation to revision of annual caps for existing continuing connected transactions in relation to the supplemental financial services framework agreement, discloseable transact ...

合同编号: JT-202508-0027 系统页码:1/4 伊利财务有限公司 系统页码:2/4 金融服务框架协议之补充协议 甲方:伊利财务有限公司,一家于中国注册成立的有限公司,其注册地址为内蒙古自 治区呼和浩特市土默特左旗救勒川乳业开发区伊利大街1号伊利财务共享服务中心楼 一层南侧("甲方");及 乙方:中国优然牧业集团有限公司,一家根据开曼群岛法律注册成立的有限公司,其 注册办事处在 89 Nexus Way Camana Bay, Grand Cayman KY1-9009, Cayman Islands ("乙方")。 除文义另有所指外,本补充协议所用词汇与原合同(《金融服务框架协议》)所界 定者具有相同含义。 与 中国优然收业集团有限公司 金融服务框架协议之补充协议 合同编号:JT-202508-0027 甲乙双方已于 2023年4月24日签订《金融服务框架协议》(以下简称"原合同"), 现经双方平等协商,于 2025年[8]月[22]日在中华人民共和国呼和浩特市签订补充 协议("本补充协议")。 一、存款服务每日最高存款结余 对原合同第三条第二款的内容进行如下修改（第三条其他条款不进行修改): 1 ...

The English and Chinese versions of the Current Corporate Communication are now available on the Company's website at www.yourandairy.com and the website of The Stock Exchange of Hong Kong Limited (the "Stock Exchange") at www.hkexnews.hk, respectively (the "Website Version"). You may access the Current Corporate Communication by clicking "Investor Relations" section on the Company's website at www.yourandairy.com or browsing through the Stock Exchange's website at www.hkexnews.hk. The Company strongly reco ...

本人╱吾等 （附註1） China Youran Dairy Group Limited 中國優然牧業集團有限公司 （於開曼群島註冊成立的有限公司） （股份代號：9858） 於2025年9月26日舉行的 股東特別大會（「股東特別大會」）適用的代表委任表格 | | （附註5） 普通決議案 | （附註4） 贊 成 | （附註4） 反 對 | | --- | --- | --- | --- | | 1. | 批准、確認及追認補充金融服務框架協議（包括經修訂年度上限）及其項下擬 | | | | | 進行之交易，詳情載於本公司日期為2025年9月8日的通函（「通 函」）；及(b)授 | | | | | 權本公司任何一名或多名董事進行一切彼等認為屬必須的有關行動及事宜、 | | | | | 簽署及簽立一切有關文件（包括加蓋本公司印鑑）及採取一切彼等認為屬必須、 | | | | | 適合、適宜或權宜的有關步驟，以使補充金融服務框架協議項下經修訂年度 | | | | | 上限生效。 | | | 日期：2025年 月 日 簽 署 （附註8） ： 附註： 1. 請 以 正 楷 填上全名及地址。 2. 請填上以 閣下名義登記與本代 ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本通告之內容概不負責，對其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示，概 不 對 因 本 通 告 全 部 或 任 何 部 分 內 容 而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 China Youran Dairy Group Limited 中國優然牧業集團有限公司 （於開曼群島註冊成立的有限公司） （股份代號：9858） 股東特別大會通告 茲通告 中國優然牧業集團有限公司謹訂於2025年9月26日（星期五）上午十時 正假座中國內蒙古呼和浩特市賽罕區河西路169號 舉 行 股 東 特 別 大 會，以 考 慮 及 酌情通過（無論有否修訂）下列決議案為普通決議案： 普通決議案 「動 議 承董事會命 中國優然牧業集團有限公司 主席兼執行董事 郝海軍 2025年9月8日 – 2 – (i) 任何有權出席上述大會並於會上投票的股東，均有權委任一名或以上受委代表，代 其出席、發言並投票。受委代表毋須為股東。 (ii) 倘屬任何股份的聯名登記持有人，則任何一名有關人士均可親身或委派代表就有關 股份於股東特別大會（或其任何續會 ...

此乃要件 請即處理 閣下如 對本通函任何內容或應採取的行動 有任何疑問，應諮詢 閣下的股票經紀、銀行經理、 律師、專業會計師或其他專業顧問。 China Youran Dairy Group Limited 中國優然牧業集團有限公司 （於開曼群島註冊成立的有限公司） （股份代號：9858） 修訂與補充金融服務框架協議有關的 現有持續關連交易的年度上限； 須予披露交易； 閣下如已售出或轉讓 名 下 所 有 中 國 優 然 牧 業 集 團 有 限 公 司 股 份，應 立 即 將 本 通 函 送 交 買 主 或 承讓人，或經手買賣或轉讓的銀行、股票經紀或其他代理商，以便轉交買主或承讓人。 香 港 交 易 及 結 算 所 有 限 公 司 及 香 港 聯 合 交 易 所 有 限 公 司 對 本 通 函 之 內 容 概 不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示，概 不 對 因 本 通 函 全 部 或 任 何 部 分 內 容 而 產 生 或 因倚賴該等內容而引致之任何損失承擔任何責任。 本 通 函 僅 供 參 考，概 不 構 成 收 購、購 買 或 認 購 中 國 ...