HK Stock Market Move | YOURAN DAIRY (09858) rose by more than 4%, institutions claim that the logic of the resonance between meat and milk under the cattle cycle remains unchanged.

YOURAN DAIRY (09858) rose more than 4%, at the time of writing, it rose by 4.61%, closing at HK$3.18, with a turnover of HK$82.68 million. On the news front, China Securities Co., Ltd. pointed out that in the short term, factors such as seasonal warming of demand, reduced milk production due to heat stress on cows on the supply side, etc., have led to a slowing of the degree of cattle destocking in the past two months. However, short-term factors will not impact the logic of the cattle cycle itself, and the logic of resonance between meat and dairy under the cattle cycle remains unchanged. The pullback under short-term data shocks has instead become a very good layout point for speculative opportunities under this large cycle. Looking ahead, as seasonal weakening of demand and increasing operating pressure on related herd operators continue, the destocking trend of cattle will still be maintained, and the turning point of the original milk cycle will be closer. Guosheng Securities believes that milk prices are expected to emerge from a downward cycle, leading the opportunity for the dairy industry. The bank predicts that this round of milk prices is entering the end of the downward cycle, with the acceleration of destocking, it is expected to usher in a turning point. However, with the background of the increasing proportion of large-scale dairy farms, the volatility of milk prices will be significantly mitigated. For dairy companies, narrowing of milk price declines and reducing losses from destocking will lead to profit recovery on the financial statements.