Liziyuan Invests 200 Million to Bet on Cheese and Middle-Aged and Elderly Milk Powder? Can It Break out of Yili and Mengniu's Encirclement?

Operator Finance Network Zhou Ying / Text

Recently, Liziyuan announced that its wholly-owned subsidiary plans to invest 200 million yuan to build a cheese and middle-aged and elderly formula milk powder production line.

The announcement shows that to further optimize the company’s product structure, comprehensively improve overall profitability and risk resistance, and meet the company’s development needs and medium- to long-term strategic layout, Liziyuan’s wholly-owned subsidiary plans to construct the “Liziyuan Daily Processing 1000 Tons of Raw Milk Deep Processing Project Phase II.” The expansion mainly includes building new cheese production lines and middle-aged and elderly formula milk powder production lines, along with supporting warehousing facilities.

The total investment is about 200 million yuan, funded by self-raised and internally allocated funds. However, in the first three quarters of 2025, Liziyuan’s cash and cash equivalents decreased from 706 million yuan in the same period of 2024 to 581 million yuan, while short-term loans increased to 218 million yuan. At this time, the company also allocated 200 million yuan to build cheese and middle-aged and elderly formula milk powder production lines, which is a significant investment for Liziyuan.

Behind this, it may be related to performance decline. Since 2022, the core revenue source of Liziyuan—dairy beverage business—has seen almost no growth, hovering around 1.4 billion yuan. In the first three quarters of 2025, Liziyuan’s revenue and net profit both declined by over 8%.

It is worth noting that during the Q3 2025 performance briefing, an investor questioned, “Market, sales, R&D, production, finance—so many departments are just maintaining the status quo. After so many years, no second growth point has been discovered, and market share cannot be increased?”

In fact, Liziyuan has also explored new growth paths. It has launched plant protein drinks, vitamin drinks, tea-flavored beer, and other products, attempting to find new breakthroughs in the beverage sector. Unfortunately, all have yielded minimal results.

Liu Ping, deputy editor-in-chief of Operator Finance Network, stated that Liziyuan did not choose to compete in the infant formula sector dominated by industry giants but instead crossed into the middle-aged and elderly milk powder and cheese sectors. However, these sectors have already been early布局 by industry leaders like Yili and Mengniu. Whether Liziyuan can leverage this to discover a second growth point and increase market share still needs market verification.

(Edited by: Zhou Ying)