Core Viewpoint - The popular brand "Gao Ye Jia" is set to change ownership as A-share listed company Yiyi Co., Ltd. announced a merger and acquisition plan to acquire 100% equity of Hangzhou Gao Ye Jia Pet Food Co., Ltd. [1] Group 1: Acquisition Details - Yiyi Co., Ltd. plans to acquire Hangzhou Gao Ye Jia through a combination of share issuance and cash, with an initial earnest payment of 30 million yuan [3][11] - The acquisition aims to accelerate Yiyi's layout in the domestic pet consumption market and enter the pet food sector, establishing a dual-driven business model of "dogs + cats" [3][4] Group 2: Financial Performance - In 2023, Hangzhou Gao Ye Jia achieved revenue of 302 million yuan with a net profit of 3.08 million yuan, resulting in a net profit margin of only 1% [4] - The company’s revenue is projected to increase to 460 million yuan in 2024, with a net profit of 18.30 million yuan, leading to a net profit margin of 4% [4] - Comparatively, another pet food company, Guai Bao, reported a net profit margin of 9.95% in 2023 and 11.96% in 2024, highlighting a significant performance gap [4] Group 3: Cost and Market Strategy - The rising cost of raw materials, particularly cassava powder used in "Xu Cui Hua" cat litter, has pressured profit margins, with prices increasing by 19%-22% year-on-year [5] - To maintain market share, Hangzhou Gao Ye Jia is attempting to increase sales volume by lowering prices, with plans for further cost optimization after the second-phase factory begins production by the end of 2024 [6][7] Group 4: Impact on Yiyi Co., Ltd. - Yiyi Co., Ltd. reported a net profit margin of 11.97% in the previous year, and the acquisition of Hangzhou Gao Ye Jia is expected to drag down this margin due to the latter's lower profitability [8] - Yiyi's revenue for the first three quarters of the year was 1.306 billion yuan, a slight decline of 0.72% year-on-year, with a net profit increase of 3.82% to 157 million yuan [13][14] - The company faces challenges in its overseas markets, which account for 93.57% of total revenue, as fluctuations in international trade conditions impact its pricing power and stability [14]

Core Viewpoint - Yiyi Co., Ltd. (依依股份), known as the "first stock of pet diapers," has announced a sudden suspension of trading due to plans to acquire a pet food company specializing in cat food and cat litter [1][6]. Company Summary - Yiyi Co., Ltd. primarily engages in the production of pet hygiene products, including pet pads, pet diapers, and pet cleaning bags. The company was listed in 2021 and reported a revenue of 888 million yuan in the first half of this year, reflecting a year-on-year growth of 9.34%. The net profit attributable to the parent company was 102 million yuan, with a year-on-year increase of 7.37% [6][7]. - The company is planning to acquire Hangzhou Gaoye Family Pet Food Co., Ltd. (杭州高爷家), which was established in 2020 and has a notable presence in the pet product retail and development sector. The brand "Xucuihua" under Hangzhou Gaoye Family has gained significant recognition on e-commerce platforms [6][7]. Industry Summary - The pet economy in China has shown significant expansion, attracting various capital investments for integration and layout. This trend is expected to promote the healthy development of the sector towards branding, capitalization, and standardization [6][7]. - The overall pet market in China has grown from 97.8 billion yuan in 2015 to over 592.8 billion yuan in 2023, with a compound annual growth rate (CAGR) of 25.4%. It is projected that the market size will further increase to 811.4 billion yuan by 2025 [7].

Core Viewpoint - Company Yiyi Co., Ltd. is planning to acquire Hangzhou Gao Ye Jia You Hao Duo Mao Pet Food Co., Ltd. and raise supporting funds through a share issuance and cash payment, leading to a temporary suspension of its stock trading starting October 14, 2025 [1][4]. Group 1: Acquisition Details - The acquisition is in the planning stage, with a preliminary agreement signed with the main counterparties, but no formal transaction agreement has been executed yet [1][4]. - The final transaction price will be determined based on an evaluation report from a qualified appraisal institution, and the transaction is not expected to constitute a related party transaction or a major asset restructuring [4][7]. Group 2: Company Background - Yiyi Co., Ltd. specializes in disposable hygiene care products, including pet hygiene products, which accounted for 93.91% of its total revenue in the first half of 2025 [7]. - The company has established partnerships with international retail chains and e-commerce platforms, exporting products to nearly 40 countries [7]. Group 3: Market Potential - The pet food market is identified as a significant growth area, with the potential to reach a market size of 267 billion yuan by 2025, according to KPMG's report [7][8]. - Yiyi Co., Ltd. has previously indicated intentions to strategically invest in the pet sector, including pet food, and aims to expand its product offerings through resource integration [8].

Group 1: Stock Performance - The pet economy concept stocks are experiencing strong performance, with companies like Zhongchong Co., Tianyuan Pet, and others seeing significant gains, with some stocks hitting the daily limit [1][2] - Zhongchong Co. (002891.SZ) reported a stock price of 53.44, with a rise of 10.00% and a market capitalization of 15.77 billion [2] - Tianyuan Pet (301335.SZ) saw a stock price of 25.40, increasing by 19.98% and a market capitalization of 1.27 billion [2] - Guai Bao Pet (301498.SZ) reported a stock price of 116.02, with an increase of 11.63% and a market capitalization of 20.77 billion [2] Group 2: Financial Performance - Guai Bao Pet reported a net profit of 204 million for Q1, a year-on-year increase of 37.68% [5] - Zhongchong Co. reported a net profit of 91 million for Q1, a year-on-year increase of 62.13% [6] - Yiyi Co. reported a net profit of 54 million for Q1, a year-on-year increase of 27.96%, with a non-recurring profit of 50 million, up 40.97% [7] Group 3: Industry Trends - The integration of AI in the pet industry is rapidly expanding, with applications in health management, behavior analysis, and interactive companionship [8] - The pet industry in China is in a phase of rapid growth, with the market expected to exceed 300 billion by 2024, driven by changing consumer trends [8] - The post-2000 generation is becoming the core consumer group in the pet economy, with a pet ownership penetration rate of 24% among those over 20, indicating significant growth potential [8] Group 4: Market Insights - The current pet food market in China is valued at approximately 100 billion, with significant room for growth in average annual spending per pet [9] - The market expansion may shift from quantity-driven to price-driven growth, as the number of pets stabilizes [9] - Domestic leading brands are expected to rise, similar to Japan's market, where local brands have gained significant market share [9]