New Stock Outlook | High Potential Race Track vs. Dominant Market Situation by Giants, How Can Sheep Milk Formula "Small and Beautiful" Yiping Nutrition Break Through?

As niche demands move into the mainstream, leading the way in the segmented track of goat milk powder, Yipin Nutrition has embarked on a journey to list on the Hong Kong stock market. On August 31, Yipin Nutrition Technology (Qingdao) Group Co., Ltd. (referred to as "Yipin Nutrition") based in Qingdao, Shandong, submitted an application for listing on the main board of the Hong Kong Stock Exchange, with HAITONG INT'L and China Securities Co., Ltd. International as joint sponsors. According to the Frost & Sullivan report, based on retail sales of corresponding products in 2024, Yipin Group ranks second in the Chinese goat milk powder market with a market share of 14.0%; second in the Chinese infant formula goat milk powder market with a market share of 17.6%; and second among domestic Chinese brands in the Chinese infant special medical use formula food market with a market share of 4.5%. In this Hong Kong listing, the company intends to use the IPO proceeds for research and development, upgrading of the industrial chain and intelligent manufacturing, brand building and product marketing, international expansion, and strengthening the company's digital infrastructure. With a gross profit margin as high as 50%, focusing on a segmented track that is "small but exquisite", as the second player in the goat milk powder industry, Yipin Nutrition obviously has many commendable aspects. Yipin Nutrition is a full industry chain dairy product company that mainly focuses on the research, production, and distribution of low allergenic dairy products. The company's full industry chain model covers dairy product production from upstream with its own pastures, raw milk procurement, and supply and processing of core ingredients (such as goat whey), to middle stream formulation and production, and downstream brand promotion, distribution, and consumer interaction across the entire value chain. Specifically, Yipin has its own pastures and factories domestically and internationally (such as Spain, Korea, Heilongjiang, China), implementing a full industry chain model from "pasture grass planting-cow/goat breeding-production processing." This effectively ensures the safety, stability, and quality of the milk source, aligning with consumer upgrading trends and serving as a solid foundation to meet industry regulations. The company owns multiple brands including Yipin, Beikangxi, and Ousta, covering a range of price points and segmented demands from mass market to high-end (such as goat milk, organic, pure cow milk powder) to cater to different consumer capabilities. Among these, Beikangxi goat milk powder is one of the leading brands in the market, known for its high visibility and good reputation. With the head effect in conjunction with a full industry chain layout, Yipin Nutrition's overall performance exhibits high profitability. According to the prospectus, from 2022 to 2024, the company achieved revenues of 1.402 billion yuan, 1.614 billion yuan, and 1.762 billion yuan, respectively, with year-on-year growth. As of the first half of 2025, the company's revenue was 806 million yuan, a 10.34% year-on-year decline. Among these, the infant formula goat milk powder is Yipin's core business, contributing over 55% of revenue from 2022 to 2024, reaching 55.6% in the first half of this year. Meanwhile, the company's gross profit margin continues to rise during the reporting period: 45.2%, 49.9%, 49.9%, and 50.9% from 2022 to the first half of 2025, matching or approaching industry leaders like Feihe. This high gross profit margin may be attributed to the high-end product portfolio (especially high-margin goat milk powder) and full industry chain model (cost control in upstream). However, as goat milk powder is still a relatively niche track in China, the company has also invested a lot of effort in marketing and promotion. From the first half of 2022 to the first half of 2025, the company's sales costs were 768 million yuan, 809 million yuan, 883 million yuan, and 396 million yuan. This has obviously squeezed the company's profit margin, with net profits of 227 million yuan, 168 million yuan, 172 million yuan, and 56.88 million yuan during the same period. From the above data, it is evident that with multiple factors such as a full industry chain and successful high-end product differentiation, Yipin Nutrition is not only large in scale but also profitable, making it a "small but exquisite" player in the milk powder segment. However, being in the niche track of goat milk powder, the erosion of profits due to brand building is also inevitable. High potential segmented track vs. obvious giant monopoly situation Overall, the Chinese infant formula industry is currently undergoing a deep adjustment and transformation period of "peak total volume and structural upgrade". On one hand, due to the disappearance of core driving factors, the number of newborns in China has been declining for several years (902 million births in 2023), posing the biggest challenge for the industry. The "foundation" of the infant formula market is continuously shrinking, transitioning from incremental competition to stock competition. On the other hand, policy regulation is extremely strict, with a high entry barrier for the industry. The new national standard implemented in 2023 is known as the "strictest standard in history," with more refined requirements for the nutritional elements and ratio of formula. All brands must resubmit formula registration applications, and those who fail to pass will be eliminated. This has led to a large number of small and medium-sized brands and OEM products leaving the market, increasing industry concentration and favoring leading and compliant enterprises. In this development context, the industry is also showing characteristics of consumer trend upgrading and differentiation. Firstly, consumers are shifting from "eating enough" to "eating well," with growth in high-end and ultra-high-end product lines. Secondly, segmented tracks such as goat milk powder, organic milk powder, and special formula powder (such as hydrolyzed protein powder for allergic babies) are growing faster than regular cow milk powder, becoming important growth points. In other words, in the context of the infant formula industry reaching its peak, goat milk powder is one of the few value niches that can still maintain high growth. According to Frost & Sullivan data, goat milk powder belongs to the segmented sector of the overall milk powder market, with stable growth potential as an alternative protein source, performing better than the overall milk powder market. From 2020 to 2024, the retail sales of goat milk powder increased from 20.8 billion yuan to 25 billion yuan, with a compound annual growth rate of 4.7%. Looking ahead to 2029, it is estimated that the retail sales of goat milk powder will reach about 31.8 billion yuan, reflecting a compound annual growth rate of 4.9% from 2024 to 2029. In this regard, as one of the leading companies in the segmented track of goat milk powder, Yipin Nutrition clearly stands to benefit from the growth potential of this track. However, it is important to note that the milk powder industry has a highly concentrated competitive landscape, with a clear dominance by giants. Currently, domestic and foreign giants such as Feihe, Wyeth, Danone, Junlebao, Mead Johnson, and a2 occupy the vast majority of market share, with the top ten brands having a very high market share, showing a typical "rich get richer" Matthew effect, and a high barrier for new brands to enter. Although reputable in the segmented field, the overall brand voice and influence of Yipin are still significantly different from super head brands like Feihe, Junlebao, and Danone. Therefore, this is probably a key reason why Yipin Nutrition has put significant effort into marketing investment and consumer mindset building. In conclusion, it is evident that the goat milk powder track, is evolving from a differentiated "small but exquisite" option to a mainstream "large and strong" battleground, testing players' determination to cultivate the industry and ability to explore boundaries. For Yipin, it is both an opportunity and a challenge, but as long as the company maintains quality and its advantage in the industry chain, deepens its leadership position in segmented areas such as goat milk powder, and strives to enhance brand effectiveness through precise marketing and channel innovation, the long-term growth space of Yipin Nutrition is promising.