New Stock News | Junlebao submits application to Hong Kong Stock Exchange, ranking third among comprehensive dairy companies in China.

According to the disclosure of the Hong Kong Stock Exchange on January 19, China Huishan Dairy Holdings Company Limited (hereinafter referred to as "China Huishan") submitted its listing application to the main board of the Hong Kong Stock Exchange, with CICC and Morgan Stanley as its joint sponsors. According to a Frost & Sullivan report, based on China's retail sales in 2024, the company's "China Huishan" brand has become one of the most well-known dairy brands in China, ranking third among comprehensive dairy companies with a market share of 4.3%. Company Profile: According to the prospectus, China Huishan is an innovative-driven, leading comprehensive dairy products company in China. With 30 years of deep cultivation, the company has grown into a nationwide dairy products company with diversified product categories and integrated operational chains. Relying on deep consumer insights and strong R&D capabilities, China Huishan has successfully captured the growth opportunities in the low-temperature liquid milk sector by introducing innovative low-temperature yogurt and fresh milk products that closely match consumer preferences. According to the Frost & Sullivan report, based on China's retail sales, the "Fresh and Simple" and "Joyful and Fresh" brands became the top brands in low-temperature yogurt and high-end fresh milk markets, respectively, within five years of their launch. In addition to the rapidly growing low-temperature liquid milk sector, the company also offers major products such as powdered milk, room-temperature liquid milk, and other dairy products, providing safe, high-quality, nutritious, and healthy dairy solutions for consumers of all ages. China Huishan's flagship products are highly favored by consumers and maintain a leading position in multiple dairy product categories. According to the Frost & Sullivan report, based on China's retail sales: In 2024, the company ranked second in China's low-temperature liquid milk market with a market share of 14.5%. The low-temperature liquid milk segment is the fastest-growing segment in the Chinese liquid milk market, with a market size of 89.7 billion yuan in 2024, expected to increase to 125.9 billion yuan by 2029 at a compound annual growth rate of 7.2%. In 2024, the company ranked third in China's fresh milk market with a market share of 10.6%. In 2024, "Joyful and Fresh" became the top brand in the high-end fresh milk market, with a market share of 24.0%. In 2024, the company ranked second in China's low-temperature yogurt market with a market share of 17.2%. In 2024, "Fresh and Simple" was the top brand in low-temperature yogurt with a market share of 7.9%. Since launching infant formula products in 2014, the company has been meeting the nutritional needs of Chinese babies with high-quality products. The company has consistently ranked among the top three domestic infant formula companies from 2020 to 2024, with a market share of 5.0% in 2024. China Huishan's brand portfolio continues to expand and improve as the company develops. According to the Frost & Sullivan report, "China Huishan" is one of the most recognizable national dairy brands. The brand represents the company's comprehensive layout in the low-temperature liquid milk, powdered milk, and room-temperature liquid milk sectors. The launch of the "Fresh and Simple" brand in 2017 marked the company's entry into the healthy yogurt track and played a key role in driving the consumption of zero-added sugar yogurt. The launch of the "Joyful and Fresh" brand in 2019 reflects the company's strategic focus on high-quality fresh milk in the wake of technological innovation and product design upgrades. Since launching its first infant formula in 2014, the company has continued to invest in scientific nutrition and formula research and development. The recent launch of the "Excellent Treasure Love" infant formula product has been rated by the China Foods Scientific and Technological Association to reach an international leading level, promoting the scientific development of infants' brains and bodies. The company's main brands have established strong brand assets in their respective segments. With strong technological R&D capabilities and high-quality milk sources, the company has successively launched domestic high-quality additive-free cream, high-end butter, and dairy products for enterprise customers to meet the rapidly growing demand for dairy products brought about by the upgrading of baking, freshly brewed coffee, and tea store chains, providing new growth engines for the company's future development. China Huishan's operations cover the entire industry chain, with self-operated farms and production bases forming the core foundation of product quality and providing support for overall operational efficiency. As of September 30, 2025, the company operates 33 farms and 20 dairy product production factories in China. Financial Information: Operating Income: In the fiscal years 2023 and 2024, and for the nine months ended September 30, 2024 and September 30, 2025, the company achieved operating income of approximately RMB 17.546 billion, RMB 19.833 billion, RMB 14.909 billion, and RMB 15.134 billion, respectively. Gross Profit and Gross Profit Margin: In the fiscal years 2023 and 2024, and for the nine months ended September 30, 2024 and September 30, 2025, the company recorded gross profits of approximately RMB 6.004 billion, RMB 6.874 billion, RMB 5.181 billion, and RMB 4.835 billion, with corresponding gross profit margins of 34.2%, 34.7%, 34.7%, and 32.0%, respectively. Net Profit: In the fiscal years 2023 and 2024, and for the nine months ended September 30, 2024 and September 30, 2025, the company recorded net profits of RMB 5.58 million, RMB 1.115 billion, RMB 722 million, and RMB 902 million, respectively. Industry Overview: Compared to developed markets, the Chinese dairy industry started relatively late. However, with rapid modernization of the entire industry chain and increasingly efficient supply chain integration, the industry has achieved rapid catch-up development. With the acceleration of urbanization, increasing consumer health awareness, and continuous innovation and upgrading of products, the Chinese dairy market is expected to maintain steady growth. Liquid dairy products are the largest segment of the dairy product market. Classified by storage conditions, liquid dairy products are mainly divided into low-temperature liquid dairy products and room-temperature liquid dairy products. Low-temperature liquid dairy products mainly include fresh milk and low-temperature yogurt, while room-temperature liquid dairy products mainly include ultra-high-temperature sterilized milk and room-temperature yogurt. By retail sales, liquid dairy products accounted for 54.3% of China's dairy product market in 2024, with a market size of RMB 355 billion. It is expected that the market size will reach RMB 395.4 billion by 2029 at a compound annual growth rate of 2.3% from 2025 to 2029. Powdered milk products are the second-largest segment of the Chinese dairy product market, including infant formula milk powder, children's milk powder, and adult milk powder. By retail sales, powdered milk products accounted for 26.7% of China's dairy product market in 2024, with a market size of RMB 176.6 billion. Since 2019, the compound annual growth rate has been negative 1.2%. Looking ahead, with the gradual implementation of China's national strategic goal of high-quality population development, as well as the dividends of comprehensive fertility support policies such as fertility subsidies and universal childcare, the market is expected to stabilize and recover. The market is expected to reach RMB 191 billion by 2029, with a compound annual growth rate of 1.8% from 2025 to 2029. Other dairy product categories have diverse forms, including cheese, butter, cream, condensed milk, and ice cream. In recent years, this segment has seen rapid growth. By retail sales, the market size increased from RMB 82.5 billion in 2019 to RMB 121.9 billion in 2024, with a compound annual growth rate of 8.1%. Looking ahead, with accelerated localization of the supply chain in the catering channel and strong innovation momentum in food applications such as freshly brewed coffee, tea beverages, and bakery products, the segment is expected to reach RMB 162.8 billion by 2029, with a compound annual growth rate of 5.5% from 2025 to 2029. Liquid dairy products are the most basic form of dairy consumption, with wide consumer popularity and daily drink properties. By retail sales, the market size of liquid dairy products in China increased from RMB 327.1 billion in 2019 to RMB 355 billion in 2024 and is expected to further increase to RMB 395.4 billion by 2029, with compound annual growth rates of 1.7% from 2019 to 2024 and 2.3% from 2025 to 2029. Based on retail sales in 2024, liquid dairy products accounted for 54.3% of China's dairy product market size. By retail sales, the Chinese low-temperature liquid dairy products market has shown strong growth resilience, outpacing the overall industry, with a market size increasing from RMB 77.4 billion in 2019 to RMB 89.7 billion in 2024, with a compound annual growth rate of 3.0%. Therefore, the retail sales share of low-temperature liquid dairy products in the Chinese liquid milk market increased from 23.7% in 2019 to 25.3% in 2024, highlighting their role as a key driver of structural market expansion. Looking ahead, this trend of structural upgrades is expected to continue. By 2029, the market size is expected to reach RMB 125.9 billion, with a compound annual growth rate of 7.2% from 2025 to 2029, and its share in the liquid dairy product market is expected to further increase to 31.8% by 2029. The penetration rate of low-temperature liquid dairy products in China is still much lower than mature markets such as the United States and Japan, where the penetration rates exceed 90% and 75%, respectively, revealing significant growth potential in the future. By retail sales, the market size of room-temperature liquid dairy products in China increased from RMB 249.7 billion in 2019 to RMB 265.3 billion in 2024, with a compound annual growth rate of 1.2%. Looking ahead, in the context of continued consumption upgrades and the adjustment of product portfolios towards high-end and functionalization, the market for room-temperature liquid dairy products is expected to sustain mild growth, reaching RMB 269.5 billion by 2029. From 2025 to 2029, the market is expected to grow at a compound annual growth rate of 0.4%. Infant formula milk powder is the largest segment of the Chinese milk powder market. As the implementation of the New National Goals promotes industry consolidation and consumer willingness to pay for scientifically validated formulas such as A2 protein, OPO structure fat, and lactoferrin, supporting continued structural upgrades. By retail sales, the Chinese infant formula milk powder market reached RMB 146.5 billion in 2024, accounting for 83.0% of the total milk powder market. Board of Directors Information: The board of directors currently consists of nine directors, including three executive directors, three non-executive directors, and three independent non-executive directors. The board of directors serves a term of three years, with the possibility of consecutive re-election, and is responsible for the management and operation of the company, possessing general authority. Equity Structure: Lehui Ruisheng holds 11.36% of the shares, Yuehui Xinghong holds 5.41%, Yuehui Xinghong Yi Hao holds 1.60%, Runde Zhiying Er Hao holds 0.24%, Zhen Lecheng holds 2.25%, and Zhen Lecheng Shi Er Hao holds 0.86%, totaling 21.99% of the shares. Mr. Wei Lihua holds 37.54% of the shares, controlling a total of 59.53% of the shares through Lehui Consulting, which holds 21.99% of the shares. Redpoint China holds 8.59% of the shares, Chunhua Capital Group holds 7.68%, Ping An Investment holds 4.84%, and other pre-listed investors collectively hold 19.63% of the shares. As of the last practicable date, Lehui Consulting, owned 99% by Mr. Wei, respectively serves as the general partner of Lehui Ruisheng, Lunde Zhiying Er Hao, Yuehui Xing Hong, Yuehui Xing Hong Yi Hao, Zhen Le Cheng, and Zhen Le Cheng Shi Er Hao. Therefore, under the Securities and Futures Ordinance, Mr. Wei and Lehui Consulting are considered to have a stake in Lehui Ruisheng, Yuehui Xing Hong, Yuehui Xing Hong Yi Hao, Runde Zhiying Er Hao, Zhen Le Cheng, and Zhen Le Cheng Shi Er Hao. Intermediary Team: Joint Sponsors: China International Financial Hong Kong Securities Limited, Morgan Stanley Asia Limited Company Legal Advisors: Hong Kong and U.S. Law: Davis Polk & Wardwell; Chinese Law: Guohao Attorneys at Law (Shanghai) LLP; Chinese Data Compliance: Guohao Attorneys at Law (Beijing) LLP Joint Sponsors Legal Advisors: Hong Kong and U.S. Law: Sidley Austin LLP; Chinese Law: Beijing Jiayuan Law Firm Reporting Accountants and Auditors: Deloitte Touche Tohmatsu Certified Public Accountants LLP (Special General Partnership) Industry Consultants: Frost & Sullivan (Beijing) Consulting Co., Ltd. Shanghai Branch Independent Property Valuer and Independent Bioassets Valuer: Asia Pacific Assessment Consultancy Limited Compliance Advisor: SOMERLEY CAP Limited.