Core Viewpoint - Yili Group has been awarded the title of "2026 China's Outstanding Employer" by the Top Employers Institute, marking its second time receiving this honor and making it the only dairy company in China to achieve this certification in the current year [1] Group 1: Talent Strategy and Culture - Yili's recognition as a "China Outstanding Employer" reflects its commitment to a talent philosophy that emphasizes respect, cohesion, achievement, and development of individuals [1] - The company fosters an open and inclusive culture for new employees through innovative onboarding activities, allowing them to feel a sense of belonging and encouraging creativity from day one [2] - Yili has established a comprehensive talent development system that addresses diverse employee needs throughout their career stages, including the creation of a digital learning platform and innovative projects like the "AI Super Ability Exploration Plan" [2] Group 2: Employee Welfare and Engagement - Yili's "Spring Rain Plan," which has been in place for 14 years, integrates employee care into daily practices, offering over 40 benefits, with 85% being non-statutory [3] - The company organizes significant cultural events, such as the "2025 Elite Gathering," where employees celebrate with their families, reinforcing a sense of community [3] - Yili's commitment to sharing development results with employees is evident in its quality management and technological innovation efforts, ensuring tangible rewards for hard work [4]

Core Viewpoint - Inner Mongolia Yili Industrial Group Co., Ltd. is participating in a share placement and subscription of new shares in China Youran Dairy Group Co., Ltd. through its wholly-owned subsidiary, aiming to enhance its supply chain efficiency and secure high-quality milk sources for better development in the dairy processing business [1][6]. Group 1: Transaction Overview - The company, through its subsidiary Boyuan Investment Holdings Ltd., holds a 33.93% stake in Youran Dairy. It will sell 299,250,000 shares at HKD 3.92 per share and simultaneously subscribe for the same number of new shares at the same price [1][2]. - The total subscription amount for the new shares is HKD 1,173,060,000 [3]. Group 2: Approval Process - The transaction was approved by the company's board of directors on January 14, 2026, with unanimous support, and does not require shareholder approval as it falls within the board's authority [3][4]. Group 3: Pricing Basis - The pricing for the sale and subscription was based on the latest market price of Youran Dairy prior to the agreement and was determined through fair negotiations between the parties involved [4]. Group 4: Financial Arrangements - Funding for the transaction will come from various sources, including potential capital increases from the company to Boyuan Investment and self-raised funds by Boyuan Investment [5]. Group 5: Impact on the Company - The transaction is strategically significant as it allows the company to secure high-quality milk sources and enhance its competitive position in the dairy industry, aligning with its long-term development goals [6].

（一）签署《配售及认购协议》 证券代码：600887 证券简称：伊利股份 公告编号：临 2026-007 内蒙古伊利实业集团股份有限公司关于 境外全资子公司参与中国优然牧业集团有限公司 配售及认购新股的公告 本公司董事会及全体董事保证本公告内容不存在任何虚假记载、误导性陈述或 者重大遗漏，并对其内容的真实性、准确性和完整性承担法律责任。 内蒙古伊利实业集团股份有限公司（简称"公司"）通过境外全资 子公司博源投资控股有限公司（简称"博源投资"）及香港金港商贸控 股有限公司（简称"金港控股"）合计持有中国优然牧业集团有限公司 （9858.HK，简称"优然牧业"）33.93%的股权。为充分发挥公司供应链 高效协同优势，保障公司高品质奶源需求，更好地抓住乳制品深加工业 务发展契机，实现更好地发展，公司通过境外全资子公司博源投资参与 优然牧业配售及认购新发行股份。 一、本次交易基本情况 公司通过境外全资子公司博源投资参与优然牧业配售及认购新股， （1）博源投资作为卖方，与优然牧业、配售代理J.P. Morgan Securities (Asia Pacific) Limited（简称"摩根大通证券"）及中信里昂证券有 ...

Group 1 - The company, Yili Group, announced that it holds a total of 33.93% equity in Youran Dairy through its wholly-owned subsidiaries, Boyuan Investment and Jinguang Holdings [1] - On January 16, 2026, Boyuan Investment will participate in the placement and subscription of new shares of Youran Dairy, selling 299 million shares at a price of HKD 3.92 per share, while subscribing to the same number of new shares, with a total subscription price of HKD 1.173 billion [1] - After the completion of the transaction, the company's total shareholding will increase from 33.93% to 36.07% [1]

Core Viewpoint - Yili Group has been awarded the "2026 China Top Employer" title for the second consecutive time, becoming the only dairy company in China to receive this certification in 2026, highlighting its commitment to a strong corporate culture and talent strategy [1][5]. Group 1: Talent Strategy - Yili's recognition as a "Top Employer" reflects its long-term commitment to the talent philosophy of "respecting, uniting, achieving, and developing people" [1]. - The company emphasizes an open and inclusive culture, allowing new employees to express their creativity and individuality from day one through innovative onboarding activities [5]. - Yili has established a comprehensive talent development system that supports career advancement at various stages, including initiatives like the "Kunlun Taihang Talent Program" and the "Anmuxi Cup Campus Innovation Competition" [7]. Group 2: Employee Welfare - Yili's "Spring Rain Plan," which has been in place for 14 years, provides over 40 benefits that address employees' daily needs and well-being, fostering a supportive workplace environment [9]. - The company celebrates employee milestones with personalized ceremonies and rewards, reinforcing the bond between the organization and its employees [9]. - Yili's commitment to sharing development outcomes is evident in its substantial rewards program, which distributed over 600 million yuan in bonuses to employees, recognizing their contributions to quality management and innovation [9]. Group 3: Corporate Culture - The award of the "2026 China Top Employer" title is seen as a collective achievement, representing the dreams and efforts of all employees, from newcomers to seasoned professionals [11]. - Yili's culture promotes a sense of belonging and encourages employees to innovate without limitations, contributing to a dynamic and engaged workforce [5][11].

Summary of Dairy Industry Conference Call Industry Overview - The dairy industry is experiencing a recovery in 2026, with total milk production stable at approximately 8.3 to 8.4 million tons, unchanged from the previous year. This stability is attributed to increased yields from large farms and the reduction of capacity in social farms, while major companies like Yili and Mengniu have not faced limitations in their own milk source development, maintaining a stable overall supply [8][9]. Key Points Milk Pricing - The price of milk supplied to Yili from farms in Xuzhou is around 3.45 to 3.48 CNY per kilogram, including a transportation cost of 0.17 CNY. In contrast, prices in Inner Mongolia are lower, ranging from 2.83 to 2.86 CNY per kilogram, highlighting regional price disparities [6]. - Northern bulk milk prices increased from 2.4 CNY per kilogram at the beginning of last year to 3.2 CNY, then fell back to a stable range of 2.8 to 2.9 CNY. Southern prices have remained higher, between 3.1 and 3.7 CNY since October, driven by improved sales from Yili and Mengniu and increased competition among small dairy producers [7]. Supply Chain Dynamics - In the first half of 2026, Yili limited the purchase of fresh milk from social farms to about 75% of their quota. However, this restriction eased in October, and by November and December, full purchases resumed, with expectations of potential limitations lasting four months post-Spring Festival [5][14]. - The overall consumption of dairy products has improved in 2026, with a notable increase in market consumption compared to 2025, driven by the performance of large dairy companies [8]. Cattle and Feed Costs - The price of beef cattle has stabilized, with cull cow prices rising to around 21 CNY per kilogram, allowing for profitability in raising replacement heifers. The profit from culling a mature cow is approximately 8,000 CNY [11][20]. - Feed costs vary by region, with southern feed costs at about 1.85 CNY per kilogram and cash flow costs between 2.6 and 2.7 CNY. Northern feed costs are lower at approximately 1.63 CNY per kilogram, with cash flow costs around 2.3 CNY. The decline in feed prices has allowed most social farms to avoid cash flow losses [12][13]. Future Outlook - Yili is expected to continue limiting supply after the Spring Festival for about four months, but no further price reductions are anticipated. The market outlook for the second half of the year appears positive, with expectations of price stabilization due to competition from small dairy producers [14]. - The price of bulk milk is projected to rise in the second half of 2026, with reasonable ranges expected between 2.6 and 2.9 CNY per kilogram, and potential increases to 3 to 3.5 CNY during September to October [17]. Challenges and Risks - The proportion of calves in the Baotou region is currently low at about 30%, while a healthy range should be between 35% and 40%. This shortage poses a risk to future development and could lead to increased operational risks if not addressed [2][37]. - Some social farms have exited the industry due to financial pressures and limitations imposed by major companies, with approximately three to four farms ceasing operations in 2026 [10]. Additional Insights - The government has been supporting the development of small dairy processing plants since late 2020, which has led to increased competition for milk sources and higher prices for producers [29][30]. - The overall cash flow situation for farms in the Baotou region is relatively balanced, aided by government subsidies ranging from 5 million to 10 million CNY annually [34]. This summary encapsulates the key insights and dynamics within the dairy industry as discussed in the conference call, highlighting pricing trends, supply chain challenges, and future outlooks.

Group 1 - The livestock farming industry in China is undergoing a significant transformation, with the Ministry of Agriculture and Rural Affairs and the National Development and Reform Commission calling for capacity reduction and operational control as of September 2025 [1][19] - The pig cycle typically follows a pattern of price fluctuations, with each upward cycle lasting about 1-2 years and downward cycles lasting about 1-3 years, indicating potential for price increases following supply reductions [1][19] - Current signals suggest that the pig farming industry is at a relatively low valuation, with indications that capacity reduction may accelerate [1][19] Group 2 - The CSI Livestock Farming Industry Index, launched on December 31, 2021, includes 50 listed companies in sectors such as livestock products, animal health, feed, meat products, and dairy products, serving as a benchmark for the overall performance of the livestock farming sector [2][20] - The index has a base point of 1000 and aims to reflect the core fluctuations of the livestock farming industry, with a high concentration of leading companies [4][23] - The top five constituent stocks account for 50.1% of the index, while the top ten account for 67.6%, indicating a significant concentration advantage in the industry [4][23] Group 3 - The CSI Livestock Farming Industry Index has outperformed its peers by 5 percentage points since its inception, with a current PE (TTM) ratio of 19.02, indicating a low valuation at the bottom of the cycle and potential for valuation recovery [6][26] - The index's historical performance has shown significant volatility due to the cyclical nature of the livestock farming industry [6][26] - The index is designed to provide a high-purity tool for tracking the cyclical movements of pig farming, benefiting from the resilience and profit elasticity of leading enterprises during current cost-focused cycles [4][23] Group 4 - The top ten constituent stocks of the index include major players such as Muyuan Foods (15.6% weight), Wens Foodstuff Group (14.7%), and Haida Group (9.1%), highlighting the dominance of leading companies in the livestock sector [25] - The index is positioned to benefit from ongoing policy incentives and signals of cyclical reversal, making it an attractive investment option for those optimistic about the long-term development of the livestock farming industry [33]

Group 1 - The beverage and dairy sector increased by 0.22% on January 15, with Zhuangyuan Pasture leading the gains [1] - The Shanghai Composite Index closed at 4112.6, down 0.33%, while the Shenzhen Component Index closed at 14306.73, up 0.41% [1] - Zhuangyuan Pasture's stock price rose by 5.09% to 12.80, with a trading volume of 353,100 shares and a transaction value of 441 million yuan [1] Group 2 - The beverage and dairy sector saw a net inflow of 5.26 million yuan from institutional investors, while retail investors experienced a net outflow of 33.19 million yuan [2] - The top individual stock performers included Zhuangyuan Pasture, which had a net inflow of 41.63 million yuan from institutional investors [3] - Other notable stocks included Yili Group and Dongpeng Beverage, with net inflows of 38.09 million yuan and 36.65 million yuan, respectively [3]

Core Viewpoint - The 2025 China Enterprise ESG "Golden Responsibility Award" aims to recognize companies that have made significant contributions to ESG (Environmental, Social, and Governance) practices, promoting sustainable development in China [1][4]. Group 1: ESG Services and Initiatives - Sina Finance ESG Rating Center offers 14 ESG services, including information, reports, training, and consulting, to help listed companies promote ESG concepts and enhance their sustainable development performance [1][4]. - In 2025, many quality enterprises in China are actively practicing their responsibilities in environmental, social, and governance areas, while domestic financial institutions are steadily advancing in ESG responsible investment [1][4]. Group 2: Award Selection and Winners - The 2025 China Enterprise ESG "Golden Responsibility Award" attracted over 5,000 participating companies since its launch in November, with winners selected based on comprehensive ESG performance, professional scoring, and online voting results [1][5]. - The winners of the 2025 China Enterprise ESG "Golden Responsibility Award" for the Annual Sustainable Development Award include China General Nuclear Power, Sungrow Power Supply, Kweichow Moutai, CATL, Zijin Mining, Hikvision, Yili, Baosteel, Chint Electric, and China Mobile [2][5]. Group 3: ESG Rating Center Overview - The Sina Finance ESG Rating Center is the first Chinese ESG professional information and rating aggregation platform, dedicated to promoting sustainable development and responsible investment [3][6]. - The center aims to establish ESG evaluation standards suitable for China's characteristics and enhance corporate ratings, while also launching multiple ESG innovation indices for investors [3][6].

Core Viewpoint - The 2025 China Enterprise ESG "Golden Responsibility Award" aims to recognize companies and institutions that have made significant contributions to ESG initiatives in China, reflecting a shift from voluntary practices to compliance requirements in ESG performance [1][12]. Group 1: ESG Development and Awards Overview - By 2025, China's ESG development has transitioned from "setting standards" to "strengthening regulations," with a comprehensive disclosure standard system being established [1][12]. - The award selection attracted over 5,000 companies, with results based on ESG performance, online voting, and professional evaluations [2][12]. Group 2: Award Categories and Winners - The award categories include Excellent Environmental Responsibility Award, Excellent Social Responsibility Award, Excellent Corporate Governance Responsibility Award, Excellent Responsibility Initiative Award, Excellent Sustainable Development Award, and various responsibility investment awards [1][12]. - Notable winners of the Excellent Environmental Responsibility Award include Great Wall Motors, Hikvision, and China Petroleum [7][24]. - The Excellent Social Responsibility Award was awarded to companies such as YF Communication, ZTE, and Ningde Times [7][24]. - Winners of the Excellent Corporate Governance Responsibility Award include China Petroleum, Hikvision, and WuXi AppTec [7][24]. - The Excellent Responsibility Initiative Award was given to companies like ZTE, Sunlight Power, and Industrial and Commercial Bank of China [7][24]. - The Excellent Sustainable Development Award included companies such as WanHua Chemical, China Bank, and China Petroleum [7][24]. Group 3: Responsibility Investment Awards - The Responsibility Investment Excellent Bank Award was given to institutions like CITIC Bank and Minsheng Bank [5][21]. - The Responsibility Investment Excellent Securities Company Award included firms such as Shenwan Hongyuan and CITIC Securities [5][22]. - The Responsibility Investment Excellent Insurance Company Award recognized companies like New China Life and AIA [5][26]. - The Responsibility Investment Excellent Fund Company Award included firms such as Xinhua Fund and Harvest Fund [5][27]. - The Responsibility Investment Excellent Asset Management Institution Award recognized institutions like Ping An Asset Management and Sunshine Asset Management [5][28]. Group 4: Call to Action and Future Directions - The award committee encourages more Chinese enterprises to integrate ESG principles into their operations and strategic planning, emphasizing the importance of balancing commercial and social values [10][29].