Group 1 - Wahaha Group confirmed a contract manufacturing relationship with Jinmailang, stating that some batches of bottled water failed quality tests during self-inspection, leading to the termination of cooperation from April 2025 [1][4] - Jinmailang's chairman stated that the cooperation began in May 2024 and will end in May 2025, with over 50 million boxes delivered, equivalent to 1.2 billion bottles of water [5] - The discrepancy in termination dates between Wahaha and Jinmailang has created confusion, referred to as a "Rashomon" situation [5] Group 2 - Jinmailang's revenue has significantly declined, with reported figures of 19.076 billion yuan in 2022 and 16.57 billion yuan in 2023, indicating a downward trend [3][10] - The company has faced challenges in its IPO journey, having announced plans to go public in June 2017, but has not made progress in the past eight years [2][12] - Jinmailang's instant noodle segment reported a revenue of 6.367 billion yuan in 2023, down 11.29% year-on-year, with production decreasing by 20.09% [10][11] Group 3 - Wahaha has been adjusting its production layout, leading to some factory shutdowns, while claiming that current products meet national quality standards [8] - Jinmailang operates 26 production bases across 18 provinces, with a beverage production capacity of 2 million tons annually [8] - The company has attempted various strategies for IPO, including partnerships and financing rounds, but has yet to achieve a successful public offering [13][14][16]

Core Viewpoint - The recent surge in sales of Wahaha bottled water has led to a partnership with Jinmailang for contract manufacturing, highlighting the competitive landscape in the bottled water market in China [2][4]. Company Overview - Jinmailang's chairman, Fan Xianguo, confirmed that the company produces over 10 billion bottles of its blue label water annually, with a projected sales revenue of approximately 4 billion yuan for 2023 [2][4]. - Jinmailang's bottled water products include blue label, Liangbai, and Jinmin, with a total projected sales revenue of around 14 billion yuan for 2023 [4][6]. Market Position - In the Chinese bottled water market, Jinmailang holds a 2.3% market share, ranking seventh, while the top five companies dominate over 80% of the market [6][7]. - The leading companies in the market include Nongfu Spring, Yibao, and Wahaha, with Nongfu Spring generating 50.7 billion yuan in retail sales [6][7]. Profitability Analysis - Jinmailang's profit margins are significantly lower than competitors, with a net profit of only 0.02 yuan per bottle of blue label water, compared to higher margins for brands like Nongfu Spring [7][9]. - The competitive pricing strategy of Jinmailang, with blue label water priced at 1 yuan per bottle, has been challenged by price reductions from competitors, diminishing its low-price advantage [9][10]. Competitive Strategy - Jinmailang has focused on a low-cost strategy to capture market share in lower-tier cities, but faces challenges from competitors like Wahaha, which also target similar markets [9][11]. - The company has employed a "four-in-one" distribution model to penetrate rural markets, but this model is reportedly under review due to high operational costs [12]. Financial Performance - Jinmailang's overall revenue has declined, with reported earnings of 16.57 billion yuan in 2023, down from over 24 billion yuan in 2020-2021 [12].

Core Viewpoint - The chairman of Jinmailang responded to the controversy regarding the OEM production of Wahaha bottled water, clarifying the partnership and production details between the two companies [1][4]. Group 1: Partnership and Production Details - Jinmailang has produced over 50 million boxes (equivalent to 120 million bottles) of bottled water for Wahaha since the partnership began in May of the previous year [1]. - Jinmailang operates 26 production bases across the country, which allows for reduced transportation costs and efficient production capabilities, including 32 high-speed production lines out of 115 total beverage lines [1]. - Wahaha announced the termination of its partnership with Jinmailang effective April 2025, while Jinmailang's chairman indicated that the cooperation would end in May of this year [1][4]. Group 2: Product Quality and Market Response - Wahaha's statement acknowledged that some batches of bottled water did not pass factory sampling tests during the OEM production period, but assured consumers that all currently sold products meet national quality standards [4]. - Jinmailang's blue label bottled water is priced at 1 yuan, providing a competitive advantage in a market where similar products are priced at 2 yuan [2]. - The net profit for each bottle of blue label water is reported to be 0.02 yuan [2]. Group 3: Industry Context - Other companies, such as Suntory and Hema, also have OEM relationships with Jinmailang, with Jinmailang accounting for over 30% of Suntory's national production of oolong tea [8].

Core Viewpoint - The chairman of Jinmailang, Fan Xianguo, responded to the controversy regarding the OEM partnership with Wahaha, emphasizing the strategic advantages and production capabilities of Jinmailang in fulfilling Wahaha's demand for bottled water [1][2]. Group 1: OEM Partnership with Wahaha - Wahaha experienced a significant increase in bottled water sales last year, prompting them to seek OEM partners, leading to a collaboration with Jinmailang due to its 26 production bases and short transportation radius [1]. - From May 2022 to May 2023, Jinmailang produced over 50 million boxes (equivalent to 1.2 billion bottles) of pure water for Wahaha, which accounted for approximately 10% of Jinmailang's production capacity [1]. - Wahaha announced the termination of its partnership with Jinmailang effective April 2025, while Fan mentioned the collaboration would end in May 2023 [1]. Group 2: Cost Leadership Strategy - Jinmailang's cost leadership strategy allows it to maintain a net profit of 2 cents per bottle of blue label water, which is priced at 1 yuan, providing a competitive edge in a market where bottled water typically sells for 2 yuan [2]. - The company produces over 10 billion bottles annually, generating a net profit exceeding 200 million yuan, highlighting its focus on providing value to consumers [2]. - Jinmailang's product lineup includes various beverages, with blue label water, Liangbai, and Jinmin positioned at different price points of 1 yuan, 2 yuan, and 3 yuan respectively [2].