In 2024, Shanxi Xinghuacun Fen Wine Factory Co.,Ltd. entered the industry's top three with revenue exceeding 36 billion yuan, officially launching the "Maotai-Wuliangye-Fen Wine" era, bringing together China's three major baijiu aroma categories: sauce aroma, strong aroma, and light aroma. Despite reshaping the market landscape, Fen Wine still has a considerable gap compared to Maotai and Wuliangye. More importantly, amid the current sluggish baijiu consumption market, the challenge lies in securing greater incremental growth to boost revenue and definitively distance itself from the closely pursuing Jiannanchun.
Shanxi Xinghuacun Fen Wine Factory Co.,Ltd.'s entry into the industry's top three stems from two factors: aggressively expanding nationwide with rapid development in markets outside Shanxi Province, and benefiting from support from its second-largest shareholder China Resources Group, with Bofen and Qinghua Fen having become billion-yuan flagship products. However, during the industry adjustment period, competition in the baijiu consumption market continues to test companies' operational, brand, and channel capabilities, requiring Shanxi Xinghuacun Fen Wine Factory Co.,Ltd. to achieve continuous breakthroughs. Recently, the company's board reshuffle and governance structure adjustment will bring new development opportunities.
**Board Reshuffle**
In the coming years, how will the "Maotai-Wuliangye-Fen Wine" trio lead China's baijiu market? Beyond the volatile consumption market, this also depends on the wisdom of the companies' top decision-making teams.
On September 4, light aroma baijiu leader Shanxi Xinghuacun Fen Wine Factory Co.,Ltd. (600809.SH) announced that its 77th meeting of the eighth board of directors reviewed and approved proposals regarding independent and non-independent directors. The board agreed to nominate Yuan Qingmao, Wu Yuefei, Li Zhenhuan, Liu Weihua, Wang Yan, and Ma Wenjie as non-independent director candidates for the ninth board of directors, and Zhou Peiyu, Li Linchun, Fan Yanping, and He Zhen as independent director candidates. These candidates' qualifications have been approved by the eighth board's nomination committee and await shareholder vote approval.
Among the non-independent director candidates, they mainly come from two systems: Yuan Qingmao, Wu Yuefei, Li Zhenhuan, and Liu Weihua are nominated by controlling shareholder Fen Wine Group, while Wang Yan and Ma Wenjie are nominated by second-largest shareholder Huachuang Xinrui (Hong Kong).
Career background analysis reveals that most non-independent director candidates have administrative and enterprise management experience, while independent director candidates focus on branding, strategy, marketing, and financial accounting.
In the new board composition, Yuan Qingmao and Wu Yuefei, as the company's top two executives, have drawn particular attention. Yuan Qingmao was transferred from Shanxi Communications Investment Group to Fen Wine Group as chairman in late 2021. At that time, former chairman Li Qiuxi retired upon reaching retirement age, and the 52-year-old Yuan Qingmao took over. In June 2023, former vice chairman and general manager Tan Zhongbao retired upon reaching retirement age. In December 2024, Wu Yuefei was transferred from his position as standing committee member and vice mayor of Shuozhou City, Shanxi Province, to become vice chairman and general manager of Fen Wine Group, subsequently appointed as general manager of Shanxi Xinghuacun Fen Wine Factory Co.,Ltd., ending the year-and-a-half vacancy since Tan Zhongbao's retirement. In May 2025, Wu Yuefei was elected as company director and vice chairman.
Li Qiuxi and Tan Zhongbao served at Fen Wine Group for many years, both deeply experienced in the baijiu industry. The duo successfully brought Fen Wine Group into the 10-billion-yuan tier ahead of schedule in 2012. In contrast, both Yuan Qingmao and Wu Yuefei started from grassroots levels and worked in government departments for many years, having no baijiu industry experience before joining Fen Wine Group. However, Yuan Qingmao shares similar work experience with Li Qiuxi, both being adept at leading state-owned enterprise reforms. In 2017, Shanxi Communications Investment Group under Yuan Qingmao's leadership became a benchmark enterprise for Shanxi Province's SOE restructuring reform. After taking charge of Fen Wine Group, Yuan Qingmao proposed entering the industry's first tier during the "14th Five-Year Plan" period, achieving "one-third of the market."
**Performance Deceleration**
This board reshuffle comes after the company disclosed its semi-annual report. In the first half of 2025, the company achieved operating revenue of 23.964 billion yuan and net profit attributable to shareholders of 8.505 billion yuan, representing year-on-year increases of 5.35% and 1.13%, respectively. While still maintaining steady growth, this represents significant deceleration compared to double-digit growth in the same period last year.
This trend has been gradually emerging over recent years. In 2021, the company fell just 0.03 billion yuan short of 20 billion yuan in revenue, achieving operating revenue and net profit growth rates of 42.75% and 72.56%, respectively. Subsequently, both indicators gradually slowed, falling to single-digit growth in the first half of this year.
Against the backdrop of the baijiu industry entering a stock market era with generally slowing enterprise growth, Shanxi Xinghuacun Fen Wine Factory Co.,Ltd.'s ability to maintain growth is already commendable. In the first half of this year, 20 listed baijiu companies achieved combined net profits of approximately 94.95 billion yuan, down 1.38% year-on-year. Among them, only 6 companies saw net profit growth, with none exceeding 10%.
However, as competition intensifies in the baijiu consumption market, Shanxi Xinghuacun Fen Wine Factory Co.,Ltd. also faces growth challenges. In the first half of this year, due to declining Zhuyeqing product sales, the company's "other alcoholic beverages" revenue reached 484 million yuan, down 10.55% year-on-year. Nevertheless, core Fen Wine series products continued to serve as the mainstay, achieving revenue of 23.391 billion yuan, up 5.75% year-on-year.
During the same period, revenue from Shanxi Province and outside Shanxi Province reached 8.732 billion yuan and 15.143 billion yuan, respectively, representing year-on-year increases of 4.04% and 6.15%. Compared to growth rates of 11.36% and 25.68% in the same period last year, fatigue is evident.
As of late June 2025, the company's contract liabilities (advance receipts) totaled 5.983 billion yuan, down 31.01% year-on-year. During the same period, inventory turnover days reached 425.7 days, an increase of 32.3 days year-on-year.
Research reports suggest that over the past few years, Shanxi Xinghuacun Fen Wine Factory Co.,Ltd.'s net profit margin improved significantly, but facing declining market demand in the future, net profit margin improvement is expected to slow or decline slightly. Therefore, institutions have cautiously lowered profit forecasts for 2025-2027, projecting performance growth rates of 0.3%, 6.9%, and 9.8%, respectively.
Facing performance growth deceleration on one hand and industry demand trends toward younger consumers seeking faster sobering and lighter burden consumption on the other, the company has adjusted its product structure in recent years to establish beneficial interactions with younger consumer groups, currently still in the 1.0 exploration phase. At the 2024 Fen Wine Global Dealer Conference, the company proposed three-dimensional layout promotion to advance Fen Wine products' market expansion and influence enhancement among young people. This grand proposition has now been left to the new decision-making team.
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