GTHT released a research report stating that the baijiu industry had previously entered a period of deep adjustment. Recently, positive changes have emerged in the real estate and domestic demand sectors related to baijiu. Concurrently, Moutai's market-oriented transformation is stimulating incremental demand alongside rising wholesale prices, with multiple factors jointly catalyzing a valuation recovery.
Positive changes have recently appeared in the real estate and domestic demand sectors associated with the baijiu industry. The report recommends stocks with price elasticity, such as Kweichow Moutai (600519.SH), Wuliangye (000858.SZ), and Luzhou Laojiao (000568.SZ).
GTHT's main views are as follows: The real estate sector is warming up, and policies are becoming more proactive. Baijiu is a typical pro-cyclical industry; its market pricing considers not only its own fundamentals but also two crucial external factors: domestic demand and the real estate market's performance. The institution observes that the state has prioritized boosting domestic demand as a key task in the "15th Five-Year Plan," with various departments making frequent statements and coordinating closely. On January 20th, the National Development and Reform Commission indicated that it would research and formulate an implementation plan for the 2026-2030 strategy to expand domestic demand in 2026, providing a clear timeline for policy action.
Simultaneously, after years of adjustment, the real estate market is gradually bottoming out. On January 2nd, the journal *Qiushi* published "Improving and Stabilizing Real Estate Market Expectations," officially acknowledging that "real estate possesses significant financial asset attributes, with strong correlations, wide-ranging impact, and high social attention." It also proposed "adopting more forceful and precise measures to strengthen macro-control of the real estate market, continuously improve and stabilize market expectations, minimize the adjustment period, and smooth out market fluctuations." Furthermore, according to a January 28th report, many real estate developers are no longer required by regulators to report the "three red lines" metrics monthly; only some distressed developers are required to regularly report financial indicators like their asset-liability ratio to specialized task forces in their headquarters' cities. A series of actions indicate that domestic demand and real estate are undergoing changes, which represents a significant positive for the baijiu industry.
Moutai's market-oriented reforms are stimulating incremental demand; closely monitoring baijiu Spring Festival sales. In December 2025, Moutai formally proposed a market-oriented transformation at a distributors' conference, aiming to adjust and improve its product structure, pricing system, distribution network, and consumer services. In early 2026, it launched several products, including standard Feitian Moutai, on the iMoutai platform. According to GTHT's observations, after Moutai rationalized its price structure, channel integration improved significantly. Online, iMoutai sparked a buying frenzy, while offline, distributors' shipments were even slightly faster than in previous years, with stable wholesale prices. Recently, with increased demand for holiday gifting and consumption, standard Feitian Moutai began to see price increases. On January 29th, the wholesale price rose above 1,600 yuan, with transaction prices exceeding 1,700 yuan, demonstrating success in trading price for volume. Currently, the baijiu sector's strong start to the year is underway. Aside from a few dominant brands, enthusiasm for channel payments is generally moderate, with the peak sales period expected to arrive in February. If demand for core products, including standard Feitian, continues to be released then, it is expected to support price levels.
The cycle is bottoming out, liquidity is improving, and rising expectations may catalyze baijiu stock prices. Baijiu financial statements have shown significant clearing since Q3 2025. Taking a longer view, GTHT believes the industry is at a cyclical bottom. Looking ahead to 2026, the recovery in景气度 (prosperity) and inventory destocking will still require time. It is expected that baijiu companies will maintain channel resilience through strategies of trading price for volume or controlling volume. Recently, baijiu stock prices have been under pressure, which GTHT attributes to weak overall market sales and liquidity pressures on the sector in mid-to-late January. From this bottom position, if wholesale prices confirm stabilization, the institution believes the pressure on stock prices will ease. Should policy levels release more positive signals, it could further catalyze stock price increases.
Risk warnings: Significant correction in wholesale prices; long-term impact on demand from alcohol consumption policies; food safety risks.
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