In recent years, driven by consumption upgrades and increasing health awareness, dairy consumption trends have gradually shifted towards segmentation. In response to evolving consumer demands, milk powder brands must rely on robust formula innovation to gain a competitive edge. As the population with allergies, lactose intolerance, and poor digestion grows, hypoallergenic goat milk formula has emerged as a nutritional supplement alternative to cow's milk and plant-based milk, presenting substantial growth opportunities.
Yipin Nutrition Technology (Qingdao) Group Co., Ltd. recently submitted a listing application to the Hong Kong Stock Exchange, aiming for a main board listing. This marks the company's second attempt, following the lapse of its initial application on August 31, 2025. Haitong International and China Securities International remain the joint sponsors.
Focusing on the hypoallergenic segment, the company has established a stable market position. According to its official website, Yipin Dairy's predecessor was the Bei'an City Dairy Factory established in 1956, with nearly 70 years of dairy production history. The company has developed a national layout comprising one group center, one technology innovation center, four ranches, nine production bases, and eight product systems.
Yipin Nutrition currently focuses on two main segments: goat milk formula and Foods for Special Medical Purposes (FSMP), providing dietary solutions for individuals with allergies, lactose intolerance, and digestive issues. Its product portfolio includes infant goat milk formula, FSMP, infant cow milk formula, adult and children's milk powder, and OEM dairy ingredients.
According to Frost & Sullivan data, based on 2024 retail sales of corresponding products, the company ranks second in China's goat milk formula market with a 14.0% market share. It holds the second position in China's infant goat milk formula market with a 17.6% share. In China's infant FSMP market, it ranks second among domestic brands with a 4.5% market share.
Financially, Yipin Nutrition reported revenues of 1.614 billion yuan, 1.762 billion yuan, and 1.864 billion yuan for 2023-2025, representing growth rates of 9.17% and 5.75% respectively, indicating a slowdown in growth momentum. The company achieved approximately 183 million yuan in net profit for 2025, a 6.1% year-on-year increase. The gross profit margin slightly improved by 0.8 percentage points to 50.7% during the same period.
By product category, infant goat milk formula remains the primary revenue source, generating 926 million yuan, 1.033 billion yuan, and 1.009 billion yuan over the past three years, though its contribution decreased from 57.4% to 54.2%. The slight revenue decline in 2025 was attributed to channel inventory adjustments due to product packaging upgrades. Meanwhile, FSMP revenue grew from 130 million yuan to 339 million yuan, increasing its share from 8.1% to 18.2%, becoming the main growth driver. Infant cow milk formula continued to contract, while OEM and dairy ingredients showed minor fluctuations. Adult and children's milk powder remained stable, indicating a clear shift toward higher-margin, faster-growing segments.
Examining profitability, the company reported net profits of 168 million yuan, 172 million yuan, and 183 million yuan for 2023-2025, with growth rates of 2.6% and 6.1% respectively, primarily influenced by expenses, non-recurring items, and biological asset fair value fluctuations. Among operating expenses, sales and distribution costs continued rising, reaching 507 million yuan in 2025, a 17.4% increase, mainly due to higher platform service fees for cross-border e-commerce FSMP operations. Administrative expenses showed modest growth while financial expenses decreased, reflecting increased market investment to support FSMP expansion.
The company maintained high overall gross margins of 49.9%, 49.9%, and 50.7% from 2023 to 2025, remaining stable around 50% for three consecutive years, driven by product mix optimization and increasing contribution from high-margin businesses. However, significant margin disparities exist across product segments. FSMP maintained gross margins exceeding 74% over three years, reaching 74.7% in 2025. Infant goat milk formula margins steadily improved from 57.4% to 59.1%. Infant cow milk formula margins slightly declined to 44.7%, while adult and children's milk powder margins dropped from 26.3% in 2023 to 18.4% in 2025. OEM and dairy ingredients margins substantially decreased from 25.6% to 6.7%. Consequently, scaling back low-margin operations while expanding high-margin businesses appears crucial for future profit quality improvement.
Notably, as a dairy-related enterprise sensitive to raw milk price fluctuations, the company's business is affected by biological asset fair value changes, recording losses of 33.549 million yuan, 62.522 million yuan, and 28.567 million yuan from 2023 to 2025. These fluctuations directly impact profitability and are significantly influenced by raw milk prices and herd size, introducing some volatility to the company's performance.
The FSMP segment presents both opportunities and challenges. Currently, both goat milk formula and FSMP are in a penetration growth phase. Data indicates that 12.3% of Chinese infants aged 0-24 months experience allergy symptoms, yet infant goat milk formula penetration remains only 6.3%, suggesting substantial unmet hypoallergenic demand. The FSMP market benefits from clinical needs and regulatory standardization, with market size expected to grow from 23 billion yuan in 2024 to 53 billion yuan by 2029, representing an 18.2% compound annual growth rate. Infant FSMP is projected to grow at 15.9% CAGR, significantly outpacing the overall milk powder industry, explaining Yipin Nutrition's increased focus on this segment.
FSMP has become the company's second growth engine, achieving over 60% compound annual growth in the past three years. Covering scenarios including lactose intolerance, cow milk protein allergy, and preterm/low birth weight, the segment leverages maternal and child channel synergies for rapid expansion, forming a hypoallergenic product matrix with the core goat milk formula business. This represents the company's key competitive differentiation from traditional dairy enterprises.
However, as goat milk formula and FSPM gain popularity, leading dairy companies are accelerating their presence in hypoallergenic and high-protein segments, intensifying competition and potentially leading to product homogenization. Although the company leads in specific segments, it still trails major players, requiring strengthened brand premium and channel barriers.
Regarding distribution channels, by the end of 2025, the company covered 333 prefecture-level cities and over 2,700 county-level regions nationwide, with approximately 65,000 retail outlets, including more than 13,000 maternal and child stores. Distributor channels contributed 67% of 2025 total revenue, reaching 1.248 billion yuan. Direct sales increased from 29.4% to 33.0%, primarily through "Weiyi Zhenxuan," Tmall, JD.com, Douyin, and WeChat mini-programs, with cross-border platform "Weiyi Zhenxuan" accounting for approximately 70% of online direct sales revenue.
On the supply chain front, factors including raw material price volatility, production and logistics disruptions at overseas bases, and biological asset diseases could affect cost structure and supply stability. Additionally, the goat milk formula market faces systematic encroachment from traditional dairy giants. Leading companies such as Feihe and Yili have launched small-molecule protein cow milk formulas, directly competing with goat milk formula on the "easy absorption" value proposition. These established brands possess channel penetration and brand recognition advantages that Yipin cannot easily match, creating direct competition that pressures the company to enhance product innovation, quality, and channel efficiency. This competitive landscape likely constitutes a key driver behind Yipin Nutrition's Hong Kong listing aspirations.
Overall, Yipin Nutrition represents a rare investment opportunity in the hypoallergenic nutrition space. The company demonstrates leading potential through its dual focus on goat milk formula and FSMP segments, comprehensive industry chain layout, and brand barriers. It maintains solid financial performance and industry-leading gross margins, positioning it to benefit long-term from increasing market penetration. However, the company faces challenges including slowing growth, divergent profitability across segments, and intensified competition, with short-term performance susceptible to non-recurring factors. IPO proceeds are intended for product research and development, industry chain upgrades, smart manufacturing, brand building, marketing initiatives, international expansion, and digital transformation to strengthen core competitiveness. Long-term value creation will depend on successful product mix optimization, FSMP product scaling, and effective channel expansion execution.