On August 19, Jiangsu Yanghe Distillery Co.,Ltd. released its 2025 interim report. On the first trading day following the earnings release, Jiangsu Yanghe Distillery's stock price surged 5%. Since hitting bottom in June, Jiangsu Yanghe Distillery has accumulated a rebound of over 20%! What signals does this convey?
The interim report showed that Jiangsu Yanghe Distillery achieved total operating revenue of 14.796 billion yuan and net profit attributable to shareholders of 4.344 billion yuan in the first half of the year. Through the financial report, we can still discover many bright spots. Combined with a series of macroeconomic and consumption-level signals, the deep adjustment in the premium liquor industry may be nearing its end.
**1. Management's Pragmatic Response Shows Multiple Positive Signals in Financial Report**
Since the beginning of this year, the liquor industry has been affected by various factors including changes in consumption scenarios and channel inventory pressure, with the industry generally experiencing operating pressure. Against this backdrop, Jiangsu Yanghe Distillery's management has continued to respond actively and pragmatically since 2025, persistently focusing on provincial markets and key regional markets, using bottle opening and sales as policy guidance, implementing volume control and price stabilization strategies for leading products such as Dream Six+ and Haizhilan, and utilizing a "combination punch" to help markets reduce inventory and promote sales.
Although this has somewhat affected short-term financial performance, it has also gained time and space for channel price-volume ecosystem restoration. As of June 2025, Jiangsu Yanghe Distillery's inventory was 16,300 tons, down 33.96% year-on-year.
In terms of products, Jiangsu Yanghe Distillery upgraded products such as Haizhilan, extending the main base liquor storage time from the industry standard of 2 years to over 3 years, supplemented with 5-year aged flavoring liquor blending, achieving "quality enhancement without price increase."
Since the second quarter, the upgraded seventh-generation Haizhilan has been rolled out for sale in Jiangsu Province, receiving positive market response. Targeting the increasingly popular premium bottled liquor market, the company launched a heavyweight product this year - the heavily promoted Yanghe Daqu high-end bottled liquor. This product uses three-year aged base liquor and has obtained authoritative institutional certification for authentic vintage, priced at only 59 yuan and above, offering maximum value for money and receiving widespread praise upon launch.
Jiangsu Yanghe Distillery excels at creating "blockbuster" products. Currently, this product has shown initial potential as a major single product and is worth watching.
In terms of channels, offline remains the top priority. In the first half of the year, the company mainly promoted major dealer cultivation, strengthened terminal quality improvement, deepened family banquet market cultivation and township channel penetration, optimized consumer cultivation systems, and consolidated market foundations.
Specifically, Jiangsu Yanghe Distillery's dealer network was optimized, with 8,609 dealers at the end of the reporting period, including 3,010 in-province and 5,599 out-of-province, becoming Jiangsu Yanghe Distillery's backbone. Consolidating the dealer system means consolidating performance foundations, as positive changes can be seen from contract liability data.
As of the end of June, Jiangsu Yanghe Distillery's contract liability balance was approximately 5.878 billion yuan, higher than 3.938 billion yuan in the same period last year and also higher than 5.323 billion yuan in 2022, reaching a three-year high. As a "performance reservoir" indicator for the liquor industry, contract liabilities directly reflect dealers' enthusiasm for payment and procurement, indicating that dealers have good confidence in the second half market.
The industry adjustment period is precisely a good time for companies to cultivate internal capabilities. In the first half of this year, Jiangsu Yanghe Distillery's R&D expenses reached 73.2 million yuan, up 58.6% year-on-year. The company hopes to further promote scientific research implementation, improve brewing process levels, and create higher-quality products through these efforts.
In the Ninth National Wine Taster Competition, the company swept the champion, runner-up, and third place positions, demonstrating the enterprise's technical strength. Chief Engineer Zhou Xinhu was selected as a national intangible cultural heritage inheritor, reflecting the company's talent advantages. Continuous investment in R&D may precisely be Jiangsu Yanghe Distillery's commitment to long-termism.
In fact, especially during industry adjustment periods, these practices are undoubtedly wiser, as they accumulate strength for the new development cycle.
**2. New Cycle May Be Approaching**
In July this year, Jiangsu Yanghe Distillery welcomed management changes, with Gu Yu taking office as the new chairman. In the view of industry insiders, this personnel adjustment will bring new development thinking to Jiangsu Yanghe Distillery and inject new development momentum, with market participants having high expectations.
Regarding Jiangsu Yanghe Distillery's interim report, securities firms have generally given positive evaluations. Huatai Securities believes that Jiangsu Yanghe Distillery proactively optimizes product structure and implements refined channel management. Although short-term sales are under pressure, its brand value, channel network, and production capacity reserve advantages remain unchanged. The firm expects the company to achieve sustained performance improvement after external demand steadily recovers, giving a "buy rating."
The company pragmatically and rationally promotes inventory clearance, focusing on destocking and improving turnover efficiency, with provincial markets expected to gradually stabilize within the year. After the new chairman takes office, increased marketing system reorganization is expected, with anticipation for more market actions to be launched and implemented. High dividend yield will become important support for the company's stock price.
Additionally, major firms including Orient Securities, Everbright Securities, SDIC Securities, and Founder Securities have all published interim report reviews with positive views.
According to iFinD data, as of August 20, Jiangsu Yanghe Distillery's TTM dividend yield (past 12 months) reached 6.33%, higher than the TTM dividend yields of major state-owned banks including Bank of China, Agricultural Bank of China, Industrial and Commercial Bank of China, China Construction Bank, and Bank of Communications.
It's noted that besides its main business, Jiangsu Yanghe Distillery also has hidden "surprises." The interim report shows that as of June 30, Jiangsu Yanghe Distillery held China Securities Co., Ltd. stocks with a book value of 844 million yuan. This stock has risen over 50% in the third quarter of this year, expected to contribute several hundred million yuan in fair value change gains for Jiangsu Yanghe Distillery's third quarter.
Additionally, Jiangsu Yanghe Distillery holds other securities investments with a book value of 1.586 billion yuan, which are also expected to contribute decent returns in the third quarter.
Finally, from a capital perspective, the market's feedback on Jiangsu Yanghe Distillery's interim report has been relatively positive. On August 19, the day after the interim report release, Jiangsu Yanghe Distillery's stock price surged 5.36%. Since rebounding from the stock price bottom in June, cumulative gains have exceeded 20%.
This development pattern of "short-term support, medium-term highlights, and long-term barriers" enables Jiangsu Yanghe Distillery to demonstrate unique resilience during the industry adjustment period. From various signs and market feedback, a new cycle for the liquor industry is quietly approaching in the near distance.
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