Investment Rating - The investment rating for the Chinese consumer staples sector is "Outperform" for multiple companies including Guizhou Moutai, Wuliangye, and Yili [1]. Core Insights - In July 2025, among the eight key tracked consumer staples industries, six maintained positive growth while two experienced negative growth. The industries with single-digit growth include catering, soft drinks, frozen foods, condiments, dairy products, and beer, while the only declining industry was Baijiu [30]. - The growth rate of most industries has deteriorated compared to the previous month, with five industries showing a decline in growth rates and three showing improvement. The new alcohol ban and adverse weather conditions are significant negative factors impacting the sector [3][30]. Summary by Industry Baijiu (Chinese Liquor) - For the high-end and above Baijiu segment, July revenue was 19 billion yuan, down 4.0% year-on-year, with cumulative revenue from January to July at 243.1 billion yuan, a decrease of 0.8% [10]. - The low-end Baijiu segment saw July revenue of 11 billion yuan, down 3.9% year-on-year, with cumulative revenue from January to July at 115.9 billion yuan, down 12.8% [12]. Beer - The domestic beer industry reported July revenue of 17.6 billion yuan, a year-on-year increase of 0.6%, with cumulative revenue from January to July at 111.9 billion yuan, up 0.7% [15]. Condiments - The condiment industry generated July revenue of 36.6 billion yuan, a year-on-year increase of 1.1%, with cumulative revenue from January to July at 261.6 billion yuan, up 1.6% [17]. Dairy Products - The dairy industry reported July revenue of 38.4 billion yuan, a year-on-year increase of 1.1%, with cumulative revenue from January to July at 267.8 billion yuan, up 0.3% [19]. Frozen Foods - The frozen food industry had July revenue of 7.58 billion yuan, a year-on-year increase of 1.7%, with cumulative revenue from January to July at 64.5 billion yuan, up 1.4% [21]. Soft Drinks - The soft drink industry reported July revenue of 71 billion yuan, a year-on-year increase of 2.7%, with cumulative revenue from January to July at 425 billion yuan, up 2.5% [23]. Catering - The catering sector generated July revenue of 16.7 billion yuan, a year-on-year increase of 4.4%, with cumulative revenue from January to July at 103.9 billion yuan, up 3.0% [25].

Core Viewpoint - The regulatory body has introduced new requirements for listed companies to enhance their dividend distribution, leading to an early wave of dividend announcements for the 2025 interim period [1][2]. Group 1: Dividend Trends - A significant number of companies have announced their 2025 interim dividend plans ahead of the usual peak period, with at least 9 companies declaring interim dividends for the first time [1][5]. - Notable examples include WuXi AppTec, which plans to distribute 35 yuan per share, marking its first interim dividend [1][5]. - Dongpeng Beverage has announced a substantial interim dividend of 250 yuan per share, totaling 1.3 billion yuan, indicating a trend of increasing dividend payouts [3][4]. Group 2: Growth Companies and Dividends - High-growth companies are also participating in the dividend trend, with CATL announcing a 100.7 yuan per share interim dividend, nearly double its previous payout [4][5]. - The total dividend amount for CATL is projected to be 4.573 billion yuan, significantly higher than its previous interim dividend [4]. Group 3: Regulatory Influence - The increase in dividend announcements is attributed to regulatory guidance and measures aimed at companies with low or no dividends, which have been subjected to risk warnings [2][6]. - The China Securities Regulatory Commission has encouraged companies to adopt a dual dividend system, leading to a notable rise in the number of companies declaring interim dividends [6][7]. Group 4: Historical Context and Future Outlook - The number of companies declaring interim dividends has surged, with nearly 900 companies having multiple dividend distributions in the past year, compared to around 200 in 2023 [1][6]. - Analysts expect the trend of increasing interim dividends to continue, with more companies likely to announce their plans as the reporting season progresses [6][7].

Group 1 - The company has approved a share repurchase plan using its own or raised funds, with a maximum repurchase price of RMB 11.75 per share, targeting to buy back between 30 million and 60 million shares, with a total amount not exceeding RMB 705 million [1] - The repurchase period is set for 12 months from the date of the shareholder meeting that approved the plan [1] - As of July 31, 2025, the company has repurchased 3 million shares, representing 0.29% of the total share capital, with a total transaction amount of RMB 25,828,944 [2] Group 2 - The repurchase complies with relevant regulations and the company's established plan, with the highest transaction price being RMB 8.9596 per share and the lowest at RMB 8.23 per share [2] - The company has adhered to the rules regarding the timing and conditions for share repurchase, ensuring no repurchase during significant events that could affect stock prices [3] - The company will continue to implement the repurchase plan based on market conditions and will fulfill its information disclosure obligations as required by law [3]

Investment Rating - The report assigns an "Outperform" rating to multiple companies in the consumer staples sector, including Guizhou Moutai, Wuliangye, Luzhou Laojiao, and others [1]. Core Insights - The report highlights that most baijiu wholesale prices have stabilized, with specific price changes noted for various brands. For instance, the price of Feitian Moutai (case) is 1915 yuan, down by 35 yuan from the previous month, and down 665 yuan year-on-year [3][9]. - Discounts on liquid milk and beer have decreased compared to previous months, indicating a shift in pricing strategies within the consumer goods market [5][22]. Summary by Sections Baijiu Pricing - Guizhou Moutai's prices for different products have shown a decline, with Feitian Moutai (case) at 1915 yuan, down 35 yuan month-on-month and 665 yuan year-on-year [3][9]. - Wuliangye's eighth-generation price is 930 yuan, stable compared to last month and unchanged year-on-year [4][9]. - Luzhou Laojiao's Guojiao 1573 remains at 860 yuan, unchanged from last month and down 40 yuan year-on-year [4][9]. Consumer Goods Discounts - The average discount rate for liquid milk has decreased to 79.1% from 73.8% at the end of June, while the median discount rate increased to 80.3% [5][22]. - Beer discounts have also seen a slight increase, with average and median rates at 83.6% and 87.0%, respectively, compared to 81.1% and 84.6% in late June [5][22]. - Discounts for infant formula and instant foods have remained stable, with average rates at 93.0% and 94.3%, respectively [7][22].

Core Viewpoint - The valuation of Nongfu Spring has experienced fluctuations due to public sentiment, but it has actively responded, leading to a recovery in valuation to above 30x. The company's long-term growth potential and excellent business model are the main reasons for its valuation premium [2]. Group 1: Company Overview - Nongfu Spring, established in 1996, is a rare platform enterprise in the soft drink sector in China, with a comprehensive product layout including packaged water, tea, and juice [4]. - In 2024, the company is projected to generate revenue of 42.9 billion and a net profit of 12.1 billion, with a net profit margin of 28%, leading the industry in both revenue scale and profitability [4]. - The company adheres to a long-termism philosophy, aiming to create products that last a century rather than just achieving short-term revenue goals [4]. Group 2: Market Position and Strategy - The company has a highly concentrated shareholding structure, with founder Zhong Shanshan holding 84% of the shares, allowing for stable and efficient management [6]. - Nongfu Spring has a deep involvement in the upstream supply chain, including tea and fruit cultivation, positioning itself as a vertically integrated enterprise [6]. - The management team has extensive experience in the beverage industry, contributing to effective operational mechanisms and industry-leading incentives [6]. Group 3: Industry Dynamics - The packaged water market in China is expected to reach 247 billion in 2024, with a forecasted medium single-digit growth rate, driven by large and bulk packaging [14]. - The industry has experienced a shift from low-cost "one yuan" water to "two yuan" water, with Nongfu Spring successfully increasing its market share during this transition [18]. - The packaged water sector is characterized by a long lifecycle and continuous growth, benefiting from trends towards health and convenience [11][12]. Group 4: Competitive Landscape - The packaged water industry has seen a concentration of market share among leading brands, with Nongfu Spring significantly widening the gap with competitors [15]. - The competitive landscape has evolved through three phases: product-centric, channel-centric, and brand-centric, with Nongfu Spring emerging as a leader in the brand-centric phase [16][18]. - The company has effectively navigated challenges, including public sentiment issues, by focusing on rational pricing strategies and enhancing brand strength [18].

Core Viewpoint - The company reported strong revenue and net profit growth for the first half of 2025, with a year-on-year increase of 36.37% and 37.22% respectively, indicating robust performance and market expansion [1] Group 1: Financial Performance - In Q2 2025, the company achieved revenue and net profit of 58.89 billion and 13.95 billion yuan, reflecting year-on-year growth of 34.10% and 30.75% respectively, with net profit growth slightly below the forecast [1] - The company plans to distribute a cash dividend of 13 billion yuan for the first half of 2025, which accounts for 54.74% of the net profit attributable to shareholders [1] - The gross margin for Q2 2025 was 45.70%, with a slight decrease of 0.35 percentage points year-on-year, while the net margin was 23.68%, down 0.61 percentage points [3] Group 2: Product and Market Expansion - The company experienced steady growth in its beverage segments, with revenue from Dongpeng drinks, Dongpeng water, and other beverages reaching 44.60 billion, 9.23 billion, and 5.03 billion yuan respectively in Q2 2025, marking year-on-year increases of 18.77%, 190.05%, and 61.78% [1] - The company is actively expanding its market presence, with significant revenue growth in various regions, particularly in North China and online sales, which saw growth rates exceeding 50% [2] - The company has entered international markets, including Vietnam and Malaysia, adapting products to local preferences through localized strategies [2] Group 3: Operational Efficiency - The number of distributors increased by 297 to 3,279 in Q2 2025, covering 4.2 million terminal points, indicating enhanced distribution capabilities [2] - The average distributor scale grew by 22% year-on-year to 1.79 million yuan per distributor, reflecting improved distributor quality [2] - Operating cash flow for Q2 2025 decreased by 21% year-on-year to 11 billion yuan, primarily due to increased tax payments and high prepayments at the end of 2024 [3] Group 4: Future Outlook - The company is expected to maintain steady growth in 2025, driven by product expansion, new distribution points, and enhanced sales efforts [4] - Revenue projections for 2025-2027 are estimated at 206 billion, 258 billion, and 316 billion yuan, with growth rates of 30%, 25%, and 23% respectively [4] - Net profit forecasts for the same period are 45 billion, 58 billion, and 72 billion yuan, with growth rates of 35%, 29%, and 24% respectively [4]

Investment Rating - The report assigns an "Outperform" rating to several companies in the essential consumer goods sector, including Haidilao, Youran Dairy, Jiumaojiu, Modern Farming, Dasheng Holdings, Yihai International, Aoyou, and China Feihe, while Budweiser APAC is rated as "Neutral" [1]. Core Insights - The report highlights a general decline in spot cost indices for six categories of consumer goods, while futures indices primarily increased [38]. - The spot cost indices for dairy products, soft drinks, frozen foods, beer, instant noodles, and condiments changed by -2.92%, -2.46%, -1.88%, -1.78%, -1.58%, and -1.29%, respectively, while the futures cost indices changed by -1.52%/+1.64%/-1.77%/+3.57%/+0.84%/+2.89% [38]. Summary by Category Beer - The spot cost index decreased by 1.78% month-on-month, while the futures index increased by 3.57% [39]. - Year-to-date, the spot and futures indices have changed by -4.54% and -5.08%, respectively [39]. Seasonings - The spot cost index decreased by 1.29% month-on-month, while the futures index increased by 2.89% [40]. - Year-to-date, the spot and futures indices have changed by -1.7% and -3.2%, respectively [40]. Dairy Products - The spot cost index decreased by 2.92% month-on-month, and the futures index decreased by 1.52% [41]. - Year-to-date, the spot and futures indices have changed by -3.87% and -1.08%, respectively [41]. Instant Noodles - The spot cost index decreased by 1.58% month-on-month, while the futures index increased by 0.84% [42]. - Year-to-date, the spot and futures indices have changed by -4.43% and -3.07%, respectively [42]. Frozen Foods - The spot cost index decreased by 1.88% month-on-month, and the futures index decreased by 1.77% [43]. - Year-to-date, the spot and futures indices have changed by -2.95% and -3.6%, respectively [43]. Soft Drinks - The spot cost index decreased by 2.46% month-on-month, while the futures index increased by 1.64% [44]. - Year-to-date, the spot and futures indices have changed by -5.91% and -5%, respectively [44].

Core Viewpoint - The recent changes in Wahaha's online sales strategy, including the shift from third-party management to self-operated flagship stores, have raised concerns among consumers regarding service continuity and product safety [4][12]. Group 1: Company Strategy - Wahaha has transitioned from its original "official flagship store" to a new store operated by a different company, raising questions about the reliability of the new setup [3][4]. - The previous operator, Tongyuan Kang E-commerce, played a significant role in establishing Wahaha's online presence, while the new operator, Hangzhou Hengyi E-commerce, is relatively inexperienced [3][6]. - The decision to take control of online operations is seen as a move to ensure brand integrity and responsiveness to market demands, especially as online retail continues to grow [6][8]. Group 2: Consumer Concerns - Consumers are worried about the loss of their previous purchase history, loyalty points, and customer service continuity due to the abrupt change in management [4][11]. - There is skepticism about whether the new self-operated store will maintain the same level of service and product quality that consumers have come to expect [9][12]. - The shift has led to a perception that the company may prioritize its own interests over customer satisfaction, potentially alienating long-time customers [11][12]. Group 3: Market Context - The online retail market is expanding rapidly, with a reported 11.5% growth in the first four months of 2024, indicating a competitive landscape where brands must adapt quickly [6][8]. - Competitors like Nongfu Spring and Master Kong are actively engaging in promotions and marketing strategies, intensifying the competition for consumer attention [7][8]. - The industry is observing Wahaha's strategy closely, questioning whether this move will ultimately benefit consumers or serve the company's interests more [11][12].

国浩律师（杭州）事务 所 法律意见书 国浩律师（杭州）事务所 香飘飘食品股份有限公司 法律意见书 地址：杭州市上城区老复兴路白塔公园 B 区 2 号、15 号国浩律师 楼 邮编：310008 Grandall Building, No.2＆No.15, Block B, Baita Park, Old Fuxing Road, Hangzhou, Zhejiang 310008, China 电话/Tel: (+86)(571) 8577 5888 传真/Fax: (+86)(571) 8577 5643 电子邮箱/Mail：grandallhz@grandall.com.cn 网址/Website：http://www.grandall.com.cn 二〇二五年七月 国浩律师（杭州）事务所 法律意见书 国浩律师（杭州）事务所 关 于 法律意见书 致：香飘飘食品股份有限公司 国浩律师（杭州）事务所（以下简称"本所"）接受香飘飘食品股份有限公 司（以下简称"公司"）委托，指派律师出席公司 2025 年第一次临时股东会（以 下简称"本次股东会"），并依据《中华人民共和国公司法》 （以下简称"《公司 法》"）、《中 ...

Group 1 - The report highlights the importance of the "15th Five-Year Plan" in shaping China's economic direction amidst complex changes in the development environment, emphasizing the need for a balance between quality and quantity in economic growth [4][5][6] - The macroeconomic policy is expected to maintain stability and continuity, with a focus on implementing existing policies rather than introducing new ones, aiming for a GDP growth target of around 5% for the year [5][6][7] - Consumer spending is a key area of focus, with potential support policies for service consumption being considered, as well as measures to improve living standards and expand consumption demand [5][6][11] Group 2 - The report indicates that investment in infrastructure projects will continue to be a priority, with a focus on optimizing fiscal spending and avoiding new hidden debts [6][7][10] - Monetary policy is expected to utilize structural tools to support key sectors such as technology innovation and small enterprises, while maintaining liquidity in the market [7][11][12] - The report notes a shift in the approach to "anti-involution," with a focus on managing competition in key industries rather than solely addressing low-price competition [8][10][15] Group 3 - The report suggests that the capital market's attractiveness and inclusivity will be enhanced, with a focus on stabilizing and boosting market confidence [17][20] - It emphasizes the need for effective release of domestic demand and boosting consumer confidence, particularly through targeted actions to stimulate consumption [18][20] - The report discusses the importance of institutional reforms and further opening up, particularly in promoting technological innovation and integrating industry and innovation [19][20] Group 4 - The beverage industry is highlighted for its competitive dynamics, particularly regarding the strategic placement of ice cabinets to enhance product visibility and sales performance [24][25][26] - The report notes that leading brands are leveraging early investments in ice cabinet placements to create channel barriers and improve inventory management [24][25][26] - It suggests that the competitive advantage in the beverage sector will increasingly depend on effective operational strategies and the ability to adapt to market demands [25][26]