Strategic Impact Analysis of Director Change at Bright Dairy

Based on the collected data, I will provide you with a comprehensive analysis.

---

According to the latest data, Bright Dairy (600597.SS), a key player in China’s dairy industry, is currently facing significant operational pressure [0]:

Core Metrics	Value	Industry Interpretation
Market Capitalization	USD 11.262 billion	Ranks among the top in the industry in terms of scale
Current Stock Price	USD 8.17	Down 54.76% from its peak 5 years ago
P/E Ratio (TTM)	16.25x	Relatively reasonable but lacks growth support
ROE	7.18%	Weak profitability
Net Profit Margin	2.88%	Below the industry average
Current Ratio	0.86	Significant short-term debt repayment pressure

:

• Q3 2025 revenue reached USD 5.76 billion, with EPS of -USD 0.09 [0]
• Liquid milk revenue fell 8.44% year-on-year to RMB 3.54 billion [1]
• Stock performance is weak, with technicals showing a sideways consolidation pattern; the fluctuation range is referenced at [$8.12, $8.22] [0]

China’s dairy industry presents a typical

pattern [1][2]:

: The duopoly pattern of Yili and Mengniu is solid; their combined CR2 market share reached 87% in 2023 (Yili 48%, Mengniu 39%) [1]

: The competitive landscape is relatively fragmented, with regional enterprises dominating; Yili and Mengniu’s combined market share is approximately 28% [1]

: According to Euromonitor data, the 2024 liquid milk industry scale reached RMB 344.2 billion, with a CAGR of -4.2% from 2022 to 2024. In September 2025, the omnichannel sales of dairy products fell 16.8% year-on-year [1]

---

According to the announcement, this personnel adjustment was caused by work arrangements of Bright Dairy’s controlling shareholder, Bright Food Group:

• Lu Qikai
  : Resigned from the positions of Director, and Member of the Strategy Committee and Audit Committee
• Zhang Yuzhen
  : Took over the relevant positions

This change reflects the typical characteristics of state-controlled enterprises in the dairy industry:

As a Shanghai municipal state-owned enterprise, the personnel arrangements of Bright Food Group often serve the group’s overall strategic layout [2]. According to the Shanghai State-Owned Assets and Enterprise Reform Plan (2023-2025), the core goal is to promote substantive breakthroughs in reform through a “one enterprise, one policy” approach.

The dairy sector of Bright Food Group includes Bright Dairy Co., Ltd., Bright Food Singapore, etc. The overseas business of Synlait Milk in New Zealand continues to face pressure, and this personnel adjustment may prepare for subsequent strategic integration [2].

Shanghai’s state-owned enterprise reform emphasizes “focusing on core businesses, optimizing structural layout, highlighting technological innovation, and improving the governance system”. The director change is an important part of improving the company’s governance structure [2].

---

Lu Qikai also served as a member of the Strategy Committee, and his departure may lead to:

• Temporary slowdown in major strategic decision-making processes
• Need for re-alignment of the Strategy Committee’s decision-making efficiency
• A short adaptation period for the new director to participate in major decision-making

The change in the concurrent position of Audit Committee Member may affect:

• Continuity of supervision work for the internal control system
• Stability of the financial information disclosure process

According to industry analysis, Bright Dairy has long had the problem of “strategic wavering”:

• At one time, it bet on chilled fresh milk, emphasizing “freshness is justice”
• Then it followed the trend to increase investment in UHT yogurt, and was repeatedly defeated under the siege of Ambrosial and Chunzhen
• Three CEOs have been replaced in 6 years, and each round of executive replacement has brought adjustments to business strategies [3]

This personnel adjustment may provide Bright Dairy with an opportunity to

.

Bright Dairy has a prominent history of resource dispersion:

• New products are launched continuously, but there is a lack of a second super product at the level of “Moslian”
• Diversification attempts such as plant-based milk and co-branded ice creams have dispersed limited resources
• Sustained losses from overseas investments have dragged down overall financial performance [3]

The new director’s appointment may promote

and .

---

Against the background of the 2025 Dairy Industry Transformation, the differentiation among regional dairy enterprises is intensifying [1]:

Enterprise	Performance	Strategic Characteristics
Bright Dairy	Contraction Range	Trapped in East China, liquid milk revenue fell 8.44%
Sanyuan Co., Ltd.	Contraction Range	Liquid milk revenue fell 13%
New Dairy	Expansion	Double-digit growth in chilled categories, with a 40% market share in Shanghai’s premium coffee shops
Junlebao	Expansion	Maintains strong growth momentum

The duopoly’s position in the UHT milk segment is solid, and Bright Dairy’s personnel change is unlikely to alter the overall competitive landscape.

If Bright Dairy can rationalize its strategy through this adjustment, it may:

• Strengthen the defensive capabilities of its East China home market
• Enhance competitiveness against regional expanders such as New Dairy and Junlebao
• Re-establish differentiated advantages in the chilled fresh milk niche

Against the background of market contraction, personnel adjustments in state-owned dairy enterprises may indicate:

• Accelerated internal integration within the dairy sector
• Synergistic optimization with other businesses of Bright Food Group
• In the face of industry pressure, state-owned capital may strengthen strategic coordination

---

Indicator	Value	Assessment
P/E (TTM)	16.25x	At a relatively low historical level
P/B	1.19x	Below the industry average
Beta	0.38	Low stock price volatility

• Historical issue of strategic discontinuity caused by frequent executive changes [3]
• Uncertainty about whether the new director can bring strategic stability

• Continuous contraction of the liquid milk market scale (CAGR -4.2%) [1]
• Sharp decline in omnichannel dairy sales (16.8% year-on-year decline in September 2025) [1]

• Current ratio of 0.86, weak short-term solvency [0]
• Net profit margin of only 2.88%, limited profit margin [0]

• Sustained losses from overseas investments such as Synlait Milk [3]

The stock price has dropped over 50% from its peak 5 years ago; if the strategy improves, there may be opportunities for valuation repair.

Bright Dairy has maintained a leading position in the country for many years in terms of market share and technical strength in pasteurized milk, yogurt, and other products [2].

Driven by Shanghai’s “one enterprise, one policy” state-owned enterprise reform, it may receive more resource support and strategic guidance.

---

This director change at Bright Dairy is a

, but under the dual pressures of the company’s strategic predicament and intensified industry competition, its impact is :

:

• Personnel changes in the Strategy Committee and Audit Committee may bring a 1-2 quarter adaptation period
• In the current industry downturn cycle, strategy execution cannot be improved immediately

:

• If the new director can bring a clear strategic direction and a stable execution team, it may help the company emerge from its predicament
• If it continues to fall into the vicious cycle of “strategic wavering”, it will be difficult to reverse its competitive decline

For Bright Dairy, the key to breaking through its predicament lies in:

1. Strategic Focus
   : Clarify core categories and target markets to avoid resource dispersion
2. Organizational Stability
   : Establish a stable operation and management team to ensure the continuity of strategy execution
3. Differentiated Competition
   : Leverage advantages in the chilled fresh milk segment and strengthen its East China home market
4. Efficiency Improvement
   : Optimize cost structure and improve profitability

The dairy industry is in a period of in-depth adjustment, with the “invisible ceiling” effect emerging [3]. Both Bright Dairy, Yili, and Mengniu need to re-examine their growth logic.

.

---

[0] Jinling API - Market Data and Financial Indicators of Bright Dairy (600597.SS)
[1] 21st Century Business Herald - “2025 Dairy Industry Transformation: Regional Dairy Enterprises Face Intensified Differentiation” (December 26, 2025)
[2] Shanghai Stock Exchange - 2025 Corporate Bond Prospectus of Bright Food (Group) Co., Ltd.
[3] Sina Finance - “Yili, Mengniu, and Bright Dairy Hit the ‘Invisible Ceiling’ Together” (January 6, 2026)