Just yesterday, the results of the 53rd review meeting of the Beijing Stock Exchange Listing Committee in 2025 were finalized, and Sichuan Jule Food Co., Ltd. (hereinafter 'Jule Shares') successfully passed its initial public offering application. From its first prospectus submission to the Shenzhen Stock Exchange main board in December 2017, through four setbacks, and finally pivoting to the Beijing Stock Exchange, Jule Shares' listing journey has spanned eight long years. During this period, the company faced a warning letter from the CSRC due to internal control deficiencies and the sudden death of its founder during the sprint. After five attempts in eight years, the capital market doors have finally opened, but for a regional dairy company highly tied to Sichuan and heavily reliant on a single product, the real storm is just beginning.
Misappropriated funds, two suspensions, founder's death: A tortuous eight-year marathon Jule Shares' story began in 1982, initially starting with stevia glycoside extraction, and it wasn't until 1996 that it entered the dairy track under the leadership of founder Tong Enwen. With the core product 'Suan Le Nai', Jule gradually became a local memory for generations in Sichuan. However, its IPO path has been fraught with obstacles. In December 2017, it made its first attempt on the Shenzhen main board, but voluntarily withdrew three months later; subsequent attempts in 2019, 2020, and 2023 all ended in failure. Behind these repeated setbacks lies a close connection to internal control issues buried in its early years. According to the penalty decision letter issued by the CSRC in 2020, the former cashier of Jule Shares' Meishan branch had misappropriated company funds totaling up to 95.7789 million yuan. This major financial loophole was not only concealed in the initial IPO application but also exposed underlying governance issues such as inaccurate monetary fund disclosures and inaccurate rebate accruals. Although the judicial case was finalized in 2022, internal control issues still hung over the company like the Sword of Damocles. In June 2024, the Shenzhen Stock Exchange terminated its main board review. Jule Shares immediately adjusted its strategy and, in September of the same year, listed on the New Third Board and pivoted to the Beijing Stock Exchange. It wasn't until June 30, 2025, that its application was accepted. Even on the Beijing Stock Exchange, the marathon continued to face obstacles. Due to expired financial reports requiring supplementary audits, the review was suspended twice in September 2025 and March 2026, only resuming in mid-April this year. More tragically, on September 6, 2025, during the suspension period, the soul figure Tong Enwen passed away due to illness, adding uncertainty to the listing journey of this veteran dairy company.
Growth within the financial reports and the 'structural walls' beyond After the pain, the power transition was completed according to the will. Tong Enwen's daughter, TONG ZHU, inherited a 73.35% stake and became the new actual controller; son-in-law GAO ZHAOHUI took over as chairman and legal representative. Although both leaders hold permanent residency in China, Jule Shares' nature as a domestic private enterprise has not changed. The new leadership inherited a seemingly impressive performance report, but behind it lie three structural shortcomings that are becoming insurmountable walls. First, 'Suan Le Nai' is a one-legged stool, with high product concentration. The company's revenue is closely tied to milk-containing beverages, which accounted for over 58% of revenue during the reporting period, almost entirely supported by the core product 'Suan Le Nai'. In contrast, the fermented milk business, which should serve as the second growth curve, has seen its sales and proportion decline year after year. Betting growth on an aging product, this 'high concentration' structure may have defensive resilience in the short term, but its risk resistance is extremely low. This dangerous signal appeared as early as 2025, when the Chengdu market, its core base, saw its first negative growth in milk-containing beverage revenue. When the strongest defense line in the home base shows cracks, Jule's growth foundation is concerning. Second, regional concentration is too high. If a dairy company cannot expand beyond its province, its imagination space in the eyes of the capital market is greatly reduced. In 2025, Jule Shares' revenue from within Sichuan Province still accounted for 72.31%, with the majority tightly tied to Chengdu. Jule has not attempted external expansion. In 2020, the company acquired Heilongjiang Huifeng Dairy, attempting to break into the Northeast market. But this 'northern expedition' fell far short of expectations. Finally, the niche prospect of yak milk cannot quench immediate thirst. To find a breakthrough, Jule once bet some chips on plateau specialty dairy. Although the company laid out its yak milk industry chain in Hongyuan County, Aba Prefecture, as early as ten years ago, and the Shengzhou Yak Milk Dairy Products project went to market in 2024, it remains an extremely niche category. Given supply-side stability, consumer mind-share education, and high channel costs, turning this story into cash will clearly require a longer cycle.
After passing the review, the fundraising logic still needs to be tested In this IPO, Jule Shares plans to raise 552 million yuan. Compared to the 1.363 billion yuan plan when it attempted the Shenzhen main board in 2023, this figure has been reduced by more than half. From the fund allocation perspective:
278 million yuan for the Wenjiang dairy production base renovation and expansion (planned to add 120,000 tons of capacity);
179 million yuan for marketing network center upgrades;
55 million yuan and 38 million yuan for R&D upgrades and information technology construction, respectively. The sharp reduction in fundraising scale reveals the compromise of regional dairy companies in the industry's winter—the previous main board plan's animal husbandry and large-scale production base expansion projects have been completely cut. This is undoubtedly a pragmatic move in response to the domestic dairy consumption pressure and raw milk oversupply environment, but market skepticism remains: Does Jule Shares really need this money? According to financial data, as of the end of 2025, Jule Shares had monetary funds of up to 652 million yuan on its books. If including 315 million yuan in trading financial assets, the company's current 'quasi-cash' is nearly 1 billion yuan, far exceeding the IPO fundraising amount. More dramatically, during the three years of sprinting for listing, the company maintained a pace of paying cash dividends of 0.35 yuan per share annually, with cumulative dividends reaching 97.11 million yuan. This behavior of 'generously distributing dividends while asking the capital market for money' inevitably raises questions: With domestic dairy capacity already severely oversupplied, which market can absorb Jule's aggressive expansion of 120,000 tons of capacity? In the review meeting on May 29, the focus of intense questioning was on the authenticity and sustainability of performance growth and the reasonableness of gross margins. Although Jule Shares barely passed, these core business fundamentals will not be resolved by a listing pass.
Final Thoughts In the world of FMCG and retail, Jule Shares is a microcosm of many 'local tycoon' brands that deeply cultivate a single region. The strongest moat for such brands is the 'familiarity' built over generations. Drinking it as a child, always seeing it on shelves, and habitual family consumption allow a company to thrive. But precisely because of this, 'living in comfort' also signals the arrival of 'crisis'. The capital market never pays for 'sentiment' or 'familiarity'; it only worships growth. Being remembered in the past only proves you once rode the wave of an era's dividends. Whether you will be chosen in the future depends on what hard strengths you have in the new cycle when consumption dividends recede. Having obtained the ticket, Jule must now prove to the market that it can not only preserve Sichuan's sentimental memory but also truly turn that memory into a new business that can cross regional boundaries.