"Hong Kong Stock IPO Watch" Sprinting for "A+H" Dual Listing, New Dairy Industry Seeks Entry into HKEX, the Breakthrough Battle for the Second Tier of Dairy Companies

Why did AI · New Dairy Industry initiate a Hong Kong stock IPO against the industry slowdown?

Our reporter Huang Xingli (chinatimes.net.cn), Beijing report

In recent years, the dairy industry has continued to undergo deep, ongoing adjustments. Against the trend, the low-temperature track has grown, becoming the key to breaking through the industry’s bottleneck. Riding on the wave of expansion in the low-temperature track, New Hope Dairy Co., Ltd. (hereinafter referred to as “New Dairy”) has worked its way out of the narrow space between industry giants and carved out a differentiated breakthrough route. On April 2, it officially submitted its listing application for an H-share offering and listing to the Hong Kong Stock Exchange, fully kicking off the “A+H” dual-platform listing process.

This move to list in Hong Kong comes as growth in the dairy industry overall is slowing: volatility in upstream raw milk prices, weakening demand from downstream consumers, and a general consensus that the industry has entered stock competition. The market has focused on New Dairy’s strategic considerations and the quality of its business, as it chose to launch a Hong Kong IPO at this point in time.

The “Expansion Dividend” in the Low-Temperature Track

After New Dairy disclosed its IPO prospectus, this regional dairy enterprise—centered on low-temperature milk—turned in an impressive set of results. According to the prospectus and public data, in 2025 the company achieved operating revenue of 11.233 billion yuan, up 5.33% year on year, reaching a record high. Net profit attributable to shareholders was 731 million yuan, up sharply by 35.98% year on year.

Looking at a longer timeline, from 2022 to 2025, the company’s operating revenue showed steady progress. In 2022, revenue surpassed the 100 billion yuan mark. In 2023, revenue rose to 10.987 billion yuan. In 2024, it declined to 106.65 billion yuan. In 2025, it regained growth momentum, and revenue reached a new historical high. Among them, in the fourth quarter of 2025, the growth rate of net profit attributable to shareholders exceeded 60%, becoming the main period contributing to full-year profit growth.

Based on the prospectus data, low-temperature products—centered on low-temperature fresh milk and low-temperature specialty yogurt—accounted for a growing share of total revenue, increasing from 44.8% in 2023 to 53.8% in 2025. They have become the core driving force behind New Dairy’s performance growth. In addition, the gross margin of low-temperature products is about 36%, far higher than the 23% gross margin of room-temperature products, directly pulling up the overall profitability level. Multiple institutions have analyzed that the company’s profit growth rate is significantly higher than its revenue growth rate, mainly because it focuses on high-margin categories such as low-temperature fresh milk and low-temperature yogurt, reducing reliance on basic white milk and room-temperature products.

Regarding New Dairy’s performance growth, senior dairy analyst Song Liang told reporters that it mainly comes down to three aspects: first, leveraging new retail channels to achieve DTC flattening and strengthening the digital marketing system; through refined and flattened channel management, the company lowers distribution costs. Second, product innovation has strong adaptability—its innovative products have received a high level of consumer recognition. Third, cold-chain infrastructure provides assurance for end-to-end delivery of low-temperature products.

From the perspective of the industry track, China’s low-temperature liquid dairy products are becoming the main growth driver of the overall dairy market. Institutions expect the compound annual growth rate to reach 5.4% from 2025 to 2030, with the compound growth rate of the low-temperature fresh milk category approaching 9%. In addition, China’s current penetration rate for low-temperature dairy products is still far below that of mature markets such as the U.S. and Japan, meaning the track New Dairy is in still has significant room for expansion.

However, the growth dividend does not mean a smooth road ahead. On one side is the continuing expansion of the low-temperature milk track. On the other side are the real challenges brought by giants moving in and national expansion. A high-growth track is often accompanied by fiercer competition as well.

On April 3, Jia Shi Consulting partner Li Yingtou said in an interview with Huaxia Times that New Dairy’s development in recent years has mainly relied on mergers and acquisitions to integrate regional brands in different areas. In the process of national competition going forward, there are significant differences among different regional teams in terms of interest demands, corporate culture, business models, and working styles. At the same time, many coordination difficulties also arise at the operational level, such as supply-chain synergy and procurement management, which forms the primary challenge for nationwide expansion.

Not only that, New Dairy’s low-temperature milk business itself faces even higher operating thresholds. Li Yingtou further analyzed that a nationwide layout of low-temperature products must rely on a well-developed cold-chain network. Cold storage construction and cold-chain vehicle deployment are both high-investment, heavy-asset projects, placing extremely high demands on a company’s financial strength. Meanwhile, the low-temperature milk track itself has two structural challenges: one is that fresh milk has a short shelf life, so factories can only cover a radius of several dozen to several hundred kilometers, and it naturally does not have the attribute of long-distance transportation. The other is that ordinary consumers find it difficult to perceive subtle nutritional differences in fresh milk.

If the above issues stem more from the industry’s inherent characteristics, the greater pressure comes from outside. Companies such as Yili and Mengniu—dominant in the room-temperature milk market—after growth in room-temperature milk reaches its peak, are accelerating their layout in low-temperature milk and regional markets.

Li Yingtou said that these giants, leveraging resources such as capital and channels, can subsidize low-temperature products by using profits from room-temperature milk business and then discount to seize market share. This will force regional brands such as New Dairy into the trap of a price war, resulting in intense competitive squeeze. He also suggested that New Dairy can strengthen channel differentiation through methods such as home-delivered subscriptions and private-domain operations, focus on functional yogurt to achieve product differentiation, and use digitalization to drive extreme freshness to create efficiency differentiation, thereby countering the squeeze from the giants.

Overseas Market Space

Against the backdrop of slowing growth in the domestic dairy products market and entering stock competition, overseas expansion has become a common choice for leading dairy companies. Companies represented by Yili and Mengniu have accelerated their global expansion, turning overseas markets into a new growth curve.

New Dairy is also looking toward overseas markets. In its Hong Kong IPO prospectus, the company clearly includes “expanding overseas operations” in its growth strategy. It states that it will evaluate opportunities in developed markets and high-growth regions, and support international expansion through investments, acquisitions, and localized operations.

At the performance meeting held on April 2, senior management of New Dairy also took a cautious stance, noting: “The company continues to pay attention to overseas market development opportunities, carefully evaluates and advances international business layout when the time is right. Please keep an eye on the company announcements if there is progress in the future.” When a reporter asked about overseas business and the Hong Kong IPO, New Dairy said on April 3 that it is currently in a silent period and not convenient to accept interviews.

With such a cautious attitude, New Dairy has already taken the lead in trialing overseas business in the Hong Kong and Macau markets. On April 2, Hong Kong dairy company Shenle Yuan Milk Factory Limited signed a strategic cooperation memorandum with New Dairy, aiming to jointly explore the Hong Kong and Macau regions through brand alliance, supply-chain coordination, and market resource synergy.

According to the key plans in the cooperation memorandum, both parties will consider adopting a co-branded model. They plan to first launch a functional yogurt series in early summer, focusing on consumer scenarios such as “health management” and “meal replacement and replenishment.” In the fourth quarter, they plan to launch specialty flavored milk beverages and enter major supermarkets and convenience store channels across Hong Kong. Unlike Yili and Mengniu’s large-scale route targeting overseas markets in Southeast Asia, New Dairy has chosen a lighter, more regional expansion route in Hong Kong and Macau.

Song Liang analyzed for this reporter that New Dairy intends to launch functional yogurt in the Hong Kong market, with the core being to align with local consumption trends. Hong Kong has many high-salaried white-collar workers at financial institutions, and light-meal and meal-replacement products are highly favored. Moreover, the market is highly aligned with Europe and the U.S., with health-oriented products selling well. He pointed out that Hong Kong’s basic dairy market has already been occupied by foreign-funded companies and long-established domestic brands; at this time, if it enters basic products, the question of whether it can capture sales volumes remains doubtful, and the profit space would be more limited.

In Song Liang’s view, there are mainly two feasible paths for dairy companies to develop the Hong Kong market: one is to release low-cost, widely applicable products such as ice products; the other is to focus on health snacks, light meals, and meal-replacement tracks. New Dairy chose the latter, precisely matching the consumption needs of young customers in the local market. When discussing the co-branding cooperation model, Song Liang believes this approach can leverage the local resource advantages of the cooperation partner, without requiring large-scale investment. Under the premise of reducing risk, it can achieve a win-win outcome—making it a relatively better entry method at this stage.

There is no doubt that going overseas also faces multiple challenges, such as international trade policies, geopolitical factors, and localized operations. For New Dairy, the Hong Kong market is more like a “test field.” Whether its lightweight co-branding model can run smoothly, and whether it will later expand into broader overseas markets, still remains to be observed.

Responsible editor: Lu Xiao Chief editor: Han Feng