Yili Industrial (600887.SS): China Staple MAF/Golden Week call series: Navigating toward a Structured Recovery in Liquid milk; Milder Raw Milk

We hosted Yili mgmt for our China Staple Mid-Autumn Festival/ Golden Week Holiday call series on Sep 28. We came out of the meeting with strengthened confidence on Yili's long-term strategy and execution, N-T strategic focus on channel healthy & pacing /new products as well as improving S/D cycle in the industry. The company reinforces a gradually improving operating setup into 2027: liquid milk growth is expected to accelerate in 4Q26 following a stable 3Q and further growth acceleration in 2027 as demand recovers, S/D dynamic improves (favoring leading players), as well as the company's channel adjustment bearing fruit with healthier channel inventory level, and mgmt reiterated its 2030 margin target remains above the 2025 level, while remaining constructive on the industry S/D and reconsolidation dynamics in 2027 with raw milk prices likely to stabilize/modestly recover. Near-term priorities remain healthy channel structure, new products innovation/sell-through, IMF share gains (esp