Core Viewpoint - The Chinese dairy industry has transitioned from merely meeting supply to ensuring high quality, with a focus on integrated supply chains and innovation in production processes [3][10]. Industry Overview - The quality of fresh milk in China has significantly improved, with a testing pass rate of 99.96% in 2024 and an average annual milk yield of 9.9 tons per cow [3]. - The proportion of large-scale dairy farming (over 100 cows) has reached 78%, indicating a shift towards more efficient production methods [3]. - The penetration rate of low-temperature fresh milk has increased from 23% in 2020 to 41% in 2024, reflecting changing consumer preferences towards higher quality dairy products [3]. Company Strategy - Junlebao Dairy has developed a unique "zero-distance integration" model that connects grass planting, cow breeding, manure recycling, and milk powder processing into a closed-loop system [6][9]. - This model allows for fresh milk to enter the factory within 98 seconds and be processed within 2 hours, significantly reducing quality loss and ensuring superior product standards compared to international benchmarks [6][9]. - The company has invested approximately 10 billion yuan in the upstream dairy supply chain over the past decade, focusing on full-process quality control [8]. Innovation and Research - Junlebao has undertaken 77 research projects and filed 414 patents, collaborating with global research institutions to enhance its technological capabilities [10]. - The company has introduced a "brain and body dual excellence" infant formula model, which has been recognized as internationally leading in its field [10]. - The results of these innovations are reflected in the company's growth, with double-digit increases in sales and leading market shares in various dairy segments [10]. Societal Impact - The dairy industry is interconnected with agriculture, manufacturing, and consumer health, playing a crucial role in national strategies such as "Healthy China" and "fertility-friendly society" [11]. - Junlebao has initiated a 1.6 billion yuan childcare subsidy plan, aligning its business objectives with public welfare and societal needs [11]. - The company's integrated approach serves as a model for sustainable industry upgrades, emphasizing the importance of collaboration and innovation in the dairy sector [11].