Nanfang Dairy (920196.BJ) opened for subscription on September 28, with an issue price of 14.21 yuan per share, a subscription cap of 1.2314 million shares, and a price-to-earnings ratio of 11.99 times. It is listed on the Beijing Stock Exchange, with CITIC Securities acting as its sponsor.
According to the prospectus, Nanfang Dairy is mainly engaged in the manufacturing and sales of dairy products and dairy beverages. During the reporting period, the company integrated research and development, production, and sales of dairy products and dairy beverages, as well as dairy livestock farming. Its main products include various low-temperature dairy products (pasteurized milk, fermented milk, low-temperature modified milk), room-temperature dairy products (sterilized milk, modified milk), dairy beverages, other dairy products, and raw fresh milk.
The company's main products are dairy products and dairy beverages. Due to the relatively fragmented terminal consumer market, the company adopts a sales model combining distribution and direct sales to expand market coverage. Under the distribution model, the company's products are sold directly to distributors through outright purchase, and then the distributors sell them to retail terminals or end consumers. The company's direct sales model includes sales to large supermarkets, community supermarkets, and chain convenience stores, group-purchase sales, sales to grocery stores and side-food stores, e-commerce platform sales, home milk delivery, and specialty store retail.
Raw fresh milk is the main raw material procured by the company. When selecting raw fresh milk suppliers, the company evaluates them from dimensions such as quality management standards, animal inspection and quarantine, dairy cow feeding conditions, infrastructure support standards, hardware equipment standards, large-scale farming status, personnel professional level, operational standardization, and hygiene conditions. It also samples and sends the raw fresh milk they produce for testing. Only after both on-site inspection and sample testing pass is it sent to the dairy factory workshop for trial use, and only after the product trial is qualified can it enter the list of qualified suppliers. At the same time, the company's pasture management department regularly and irregularly organizes re-inspections of qualified suppliers and implements dynamic management. During the reporting period, the company procured raw fresh milk from its own pastures, pastures of controlled subsidiaries, third-party large pastures, and professional cooperatives, which can fully guarantee the supply volume and quality of the company's raw fresh milk.
During the reporting period, the company's specific procurement of raw fresh milk from different types of entities was as follows: the company has always closely followed market innovation trends, actively tapped consumer demand, and used demand as a guide to drive product innovation and upgrading. At present, the company owns dairy brands such as "Shanhua," "Huadu Pasture," "Huaxi Old Yogurt," and "Guicao," and multiple product categories including room-temperature pure milk, low-temperature yogurt, low-temperature fresh milk, and dairy beverages, meeting consumers' diverse needs. At the same time, the company also actively upgrades product formulas and processes to launch more personalized products for target segmented markets, including student drinking milk, 0-sucrose yogurt series, and ice cream yogurt.
The company mainly produces through its own production, with some products using entrusted processing. Overall, the company adopts a production model of production based on sales, arranging production plans according to sales orders. The company's products are divided into low-temperature products and room-temperature products. Because the two types of products have different shelf lives, there are also differences when arranging production plans. Among them, low-temperature products, due to their short shelf life, adopt a strict production-based-on-sales model to quickly respond to consumers' requirements for product freshness, while strictly controlling inventory to ensure product freshness. Room-temperature products, due to their longer shelf life, are produced by the production department using a "annual plan plus monthly adjustment" model to maintain a safe and reasonable inventory level.
According to statistics from the National Bureau of Statistics, in recent years China's milk output has generally shown an upward trend, reaching a high point in 2023. In 2024, due to the imbalance between supply and demand in the raw fresh milk market, raw fresh milk prices continued to decline, and milk output decreased slightly. Since the second half of 2024, with the introduction of policies to promote relief for the dairy industry and stabilize basic production capacity, such as the Notice on Promoting the Stable Development of Beef Cattle and Dairy Cow Production, and according to analysis in dairy industry research reports such as Huatai Securities' "Dairy Products: Cycle Bottoming, Supply-Demand Reconstruction, Leading Players' Profits Leap," the dairy farming industry is expected to return to supply-demand balance in 2026.
In terms of financials, for the 2023, 2024, and 2025 fiscal years, the company achieved operating revenue of approximately 1.805 billion yuan, 1.817 billion yuan, and 1.839 billion yuan, respectively; during the same periods, it recorded net profit of approximately 195 million yuan, 202 million yuan, and 219 million yuan, respectively.
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