Huachuang Securities released a research report stating that demand for Baijiu during the New Year holiday was relatively weak, with feedback from many regions indicating a year-on-year decline of over 20%, although there was a slight improvement compared to November and December. On the supply side, distilleries have lowered their targets, and channels are expected to further destock and alleviate pressure. On the demand side, channels currently hold cautious expectations for Spring Festival demand, anticipating an overall double-digit decline, but the rate of decline is expected to narrow compared to the New Year period. Regarding prices, for premium Baijiu, considering the continuous shipments through the i Moutai platform coupled with imminent arrivals through traditional channels, the wholesale price of Feitian is expected to remain under marginal pressure. Looking ahead to the full year of 2026, distilleries are shifting from passive responses to active adjustments. Opportunities are expected to emerge after Moutai's wholesale price declines and stabilizes, leading to an anticipated bottoming out and stabilization. The main views of Huachuang Securities are as follows:
New Year demand shows weak recovery, wholesale prices remain sluggish, but mass consumption demonstrates relative resilience. Demand during the New Year holiday was weak, with feedback from multiple regions indicating a year-on-year decline of over 20%, though there was a slight sequential improvement from November and December. On one hand, the New Year holiday was relatively distant from the Spring Festival, about one and a half months apart, and the industry remains in its off-season. On the other hand, consumer travel was high, but banquet performance was average. From a volume and price perspective, industry shipments during the holiday are estimated to have decreased by over 10% year-on-year, with significant reductions in demand for business banquets, corporate annual event group purchases, etc. Feedback from Jiangsu, Anhui, and other regions indicates that the scarring effects of external policies persist. Industry price levels are under pressure, with wholesale prices for premium Baijiu down over 10% year-on-year, and wholesale prices for sub-premium Baijiu generally down 5-10% year-on-year. A local bright spot is the relatively strong resilience of mass consumption, with feedback from Sichuan, Anhui, and other regions indicating good performance for mass banquets and social drinking, corresponding to good turnover in the 80-200 RMB price band.
Three key judgments for the Spring Festival: channel destocking, narrowing decline, and potential easing of supply-demand矛盾. Supply side: Distilleries have lowered targets, and channels are expected to further destock and alleviate pressure. Distilleries have begun a passive slowdown and clearance. Firstly, for 2025, aside from Moutai and Fenjiu, most distilleries failed to meet their initial annual collection targets. For 2026, most distilleries have set growth targets at flat or slight increases. Secondly, requirements for the Spring Festival 'good start' collection tasks have been lowered, mostly to 30-40%, with bill support provided. Thirdly, distillery shipment节奏 have slowed; shipments are halted if channel inventory rates exceed a certain threshold, alleviating channel pressure. Channel willingness to make payments remains relatively cautious, with a greater focus on ensuring cash flow,适度 contracting scale, and retaining only core brand distribution rights. Demand side: A double-digit decline is expected to continue, but the rate of decline is anticipated to narrow compared to the New Year period. Channels currently hold cautious expectations for Spring Festival demand, forecasting an overall double-digit decline, but with a narrower rate of decline than during New Year. Business demand remains relatively weak. Gift-giving demand during Spring Festival is relatively rigid, and its decline is expected to narrow. Demand for mass banquets and social drinking is relatively firm, primarily dragged down by price, with an overall slight decline expected. Price side: Wholesale prices for premium Baijiu will follow market conditions, trading price for volume. As price reflects the underlying supply-demand issue, price levels are expected to remain under pressure during Spring Festival. For premium Baijiu, considering continuous shipments via i Moutai and imminent arrivals through traditional channels, Feitian's wholesale price is expected to remain under marginal pressure. Wuliangye's普五 has launched scan-code activities; its wholesale price is expected to see a slight decline, but this should have some stimulating effect on sell-through. Luzhou Laojiao is expected to increase consumer-side marketing spending during Spring Festival, reducing purchase costs. For sub-premium Baijiu, wholesale prices are already at relatively low levels, channel profits are thinning, and prices are expected to stabilize at low levels during Spring Festival.
Feedback from distiller dealer conferences and recent channel conditions: Pragmatic slowdown and burden reduction, focusing on the core business. Moutai: In 2026, will comprehensively advance the market-oriented transformation of Moutai liquor marketing, building a pyramid-shaped product system and canceling distributor policies to reduce channel pressure. Simultaneously, Feitian is available on i Moutai, digitally empowering channel transformation and effectively stimulating consumer purchase demand. Wuliangye: Is both maintaining market order and strengthening channel incentives, pragmatically improving sell-through and market share. Recent wholesale prices have seen a slight decline but have provided some lift to sell-through. 'Good start' collections are underway. Luzhou Laojiao: Is seizing the strategic window for product structure adjustment, continuing to deepen the low-alcohol Guojiao product, and strengthening channel promotion efforts. Currently, the wholesale price for high-alcohol Guojiao remains around 830 RMB, with sell-through down double-digits, while low-alcohol Guojiao turnover performance is acceptable. Fenjiu: Is providing special funds for products above Qinghua 20 to strengthen regional breakthroughs. Qinghua 20 and Bofen are driving nationwide coverage. Laobaifen is focusing on key markets to increase open-bottle rates. Current inventory has slightly increased to 2-3 months, but channel cooperation is generally good. Gujing: Continues to focus on its main business, strengthening market深耕, and improving terminal sell-through. Recently, the company innovatively developed a 'wine shop' format, with standout sales performance. Yanghe: Channels continue to see pressure relief. Inventory for the Blue Classic series within its home province has been reduced to a reasonable level of around 3 months. Wholesale prices have seen a slight rebound, and dealer confidence is gradually stabilizing. Jinshiyuan: Adheres to seeking progress while maintaining stability. The淡雅 product in the mass price band achieved growth against the trend and is expected to continue contributing incremental growth. The Kai series maintains competitive advantages, with a decline rate significantly lower than the industry.
Investment advice: Pessimistic factors already priced in; catalysts strengthen closer to Spring Festival; recommend Moutai, emphasize Gujing. The Baijiu sector corrected in December, influenced both by market concerns over premium distillers' wholesale prices and year-end fund portfolio adjustments. Overall, pessimistic expectations appear priced in. Under the tone set by leading players Moutai and Wuliangye following market prices and trading price for volume, a surge in demand during the Spring Festival peak season can still be anticipated. Furthermore, the mass price band below 200 RMB has clearly benefited from mass banquets and social drinking. The closer to the Spring Festival, the stronger the recovery catalysts. Looking at the full year 2026, distilleries are moving from passive应对 to active adjustment. Opportunities lie after Moutai's wholesale price declines and stabilizes, leading to an expected bottoming out and stabilization. The picture will become clearer towards the middle of next year, making adding positions more certain. From an allocation perspective, recommend Moutai for its certainty and high dividend yield. For mass-market Baijiu during Spring Festival,重点推荐 Gujing Gongjiu (000596.SZ), whose recent significant correction may involve mispricing by funds. Monitor the clearance节奏 of Wuliangye (000858.SZ), Shanxi Fenjiu (600809.SH), and Luzhou Laojiao (000568.SZ). Additionally, consider innovative models like ZJLD (06979), etc.
Risk warnings: Baijiu demand recovery falls short of expectations; wholesale prices decline more than expected; consumption scenarios remain suppressed.
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