Shengmu Organic Milk inks new supply deal with Dabeinong and Yiyingmei Dairy

China Shengmu Organic Milk Limited entered into the 2026 Dabeinong Products and Services Supply Framework Agreement on November 19, 2025, with Dabeinong Group and Yiyingmei Dairy. This agreement, effective from January 1, 2026, to December 31, 2028, covers the procurement of various products, including feed, additives, medicines, and milk powder, as well as processing services for milk powder. The new agreement will terminate existing framework agreements upon its effective date.

Proposed annual caps for Dabeinong products are RMB415m for 2026, RMB430m for 2027, and RMB445m for 2028. For Yiyingmei processing services, the annual caps are RMB17m for 2026, RMB11m for 2027, and RMB11m for 2028. Historically, total transaction amounts for the nine months ended September 30, 2025, were RMB204m for the 2023 Dabeinong Group Materials Supply Framework Agreement, RMB0m for the 2024 Processing Service Framework Agreement, and RMB44.8m for the 2025 Yiyingmei Dairy Milk Powder Purchase Framework Agreement.

As Dabeinong Group and Yiyingmei Dairy are connected persons, the transaction is subject to reporting, announcement, and independent shareholders' approval requirements under Chapter 14A of the Listing Rules. An independent board committee has been established, and Altus Capital has been appointed as the independent financial advisor. A circular detailing the agreement and proposed annual caps is expected to be dispatched around December 8, 2025.