The food and beverage sector staged a surprising reversal today (November 13). The Food ETF (515710), which tracks the sector’s overall performance, fluctuated in negative territory during the morning session but suddenly rebounded in the afternoon, turning green with a 0.16% intraday gain by press time.
Among constituent stocks, liquor shares led the charge. By the latest update, Jinhui Liquor, Gujing Gongjiu, and Jiugui Liquor surged over 2%, while Shanxi Fenjiu, Yingjia Gongjiu, Luzhou Laojiao, and others rose more than 1%.
The rally followed the China Alcoholic Drinks Association’s release of the "China Alcoholic Drinks Industry '15th Five-Year Plan' New Cultural Development Outline." The document introduced the "139 Plan" for cultural advancement, emphasizing initiatives such as establishing "Chinese liquor studies," pursuing dual World Heritage recognition, protecting living cultural heritage, and strengthening IP development. Analysts noted that the outline not only builds on the "14th Five-Year Plan" but also addresses industry pain points. By leveraging culture, it aims to resolve short-term challenges like weak sales and unclear value propositions while enhancing the sector’s global influence and consumer appeal through theoretical frameworks, heritage certification, and IP innovation. Culture is expected to become a key moat for liquor companies navigating cycles and outperforming peers.
Valuation-wise, the food and beverage sector remains at historically low levels, presenting a potential buying opportunity. As of November 12, the Segmented Food Index tracked by Food ETF (515710) had a P/E ratio of 21.24x, near a 10-year low at the 12.13% percentile, highlighting its medium-to-long-term value.
Looking ahead, Everbright Securities noted that the sector has undergone five years of adjustment, with liquor stocks underperforming since May 2025. Interim reports from July-August showed most distilleries actively managing operations to alleviate pressure, boosting market sentiment. The CITIC Liquor Index currently trades below 20x P/E, with an average dividend yield of ~3.5%, signaling undervaluation. Given significantly lowered growth expectations, investors may consider positioning before the next upturn.
Shenwan Hongyuan Securities added that pro-consumption policies could gradually revive liquor demand, though channel inventories, wholesale prices, and earnings may lag. Stock prices might rebound ahead of fundamentals, with inventory and pricing improvements acting as catalysts. Leading firms’ shareholder-friendly policies further underscore the sector’s appeal.
For exposure to core food and beverage assets, Food ETF (515710) offers a one-click solution. It tracks the CSI Segmented Food & Beverage Industry Index, with ~60% allocated to premium and mid-premium liquor leaders and ~40% to beverage, dairy, condiment, and beer sub-sectors. Top holdings include Kweichow Moutai, Wuliangye, Luzhou Laojiao, Shanxi Fenjiu, Yanghe Brewery, Yili, and Haitian Flavouring. OTC investors can access the sector via the ETF’s feeder funds (Class A: 012548; Class C: 012549).
*Data source: SSE/SZSE, as of November 13, 2025.
*Risk disclosure: The ETF passively tracks an index whose past performance does not guarantee future results. Constituent stocks are shown for illustrative purposes only and do not constitute recommendations. Investors should assess risks independently. Fund risk rating: R3 (moderate), suitable for balanced (C3) or higher risk tolerance.
MACD golden cross signals emerge as select stocks rally.
For in-depth analysis, download the Sina Finance App.
Comments