Latest news with #KweichowMoutai
Bloomberg
7 days ago
- Business
- Bloomberg
Moutai Posts Worst Growth in Years as Chinese Cut Back on Liquor
Kweichow Moutai Co. delivered its worst six-month growth in sales or profit in years as China's top distiller struggles with weak consumer demand for premium beverages. First-half revenue increased 9.2% from a year earlier to 91.09 billion yuan ($12.7 billion), while net income climbed 8.9% to 45.4 billion yuan, the company reported Tuesday. Those are the slowest semiannual increases since at least 2016, according to data compiled by Bloomberg.
AllAfrica
31-07-2025
- Politics
- AllAfrica
To drink or not to drink – the Party decides in China
China is seeking to transform its spirits sector by prohibiting civil servants from drinking at official events while at the same time encouraging the public to drink more during family gatherings. The central government has instructed civil servants to refrain from consuming alcohol at official meetings since 2012. The original idea behind the official ban was to reduce public expenses and improve the public image of civil servants. Under the rules, many officials altered their drinking habits by rescheduling their sessions from lunch to dinner or hosting personal parties after all official meetings had concluded. At the same time, businesspeople offered officials expensive spirits as gifts, creating corruption issues. Although the central government has continued to tighten its 'alcohol ban', many civil servants habitually break the rules, with most of them managing to get away with it. Some others, however, have been arrested for drunk driving. A recent incident in Inner Mongolia has triggered changes to the booze rules. On May 6, Wei Shuanshi, deputy director of the finance and economy committee of the People's Congress of Inner Mongolia, a senior official at the State-owned Assets Supervision and Administration Commission of Inner Mongolia, and party secretary of Baotou Iron and Steel (Group) Co, accompanied a relative to go to the Baotou No.4 Hospital. Wei had a gathering with former colleagues surnamed Wang, Guo, and He in the hospital. On May 7, they had dinner with three other medical staff members. Wei said he would pay the bill and bring him a bottle of old Maotai spirit. During the dinner, Wei, Wang, Guo and one more colleague, Jiang, finished the bottle. On average, each had 125 grams of the 53% ABV liquor. After the meal, Wei asked a private firm executive to pay the bill, violating the Communist Party of China (CCP)'s anti-graft rule. Wang, Guo and Jiang went to a barbecue shop for a second round of drinking. At 6 am on May 8, Guo died at home due to alcohol poisoning. His family asked Wei to pay them compensation for his death, but they disagreed on the amount. Guo's family threatened to report the case to the CCP's disciplinary committee. On May 15, Wei reported the case to the committee. While the case initially appeared to be Guo's fault for drinking excessively at his late-evening gathering, the disciplinary committee investigated Wei for being involved in other serious violations of Party discipline and suspected illegal activities. It also punished or warned all others involved in the incident, including two team leaders who did not attend the dinner. On May 18, the State Council and the CCP Central Committee announced that civil servants are prohibited from drinking or smoking on any occasion related to their work. Officials now need approval to attend meal receptions and must avoid unnecessary private gatherings. The new rules quickly put market pressure on key spirits makers in China. Kweichow Moutai fell 11.5% within a month after the announcement, while Wuliangye Yibin dropped 10.7%. On June 18, China Central Television published an online commentary titled 'Forbidding meals that violate the discipline rules, but not all meals.' The commentary stated that some local governments had overinterpreted the new 'alcohol ban,' harming the catering sector and its workers. For example, a bank manager in Anhui was fined 3,000 yuan (approximately US$417) for having noodles with two clients; ordinary party members avoided meeting with friends; government departments screened every meal and reception; and a town in Gansu banned its civil servants from drinking, the commentary said. 'Everyday dining is the foundation of people's livelihoods, the heart of humanity and the pulse of the economy,' writes Li Jialin, the author of the opinion piece. 'The alcohol ban is supposed to be used precisely like a scalpel to curb corruption, but some local governments used it like a sledgehammer to break everything.' 'Local government officials seemed to be proactively implementing the alcohol ban, but they had a lazy governance mentality, misinterpreted the new rules, and disregarded people's livelihoods,' Li wrote. 'Now restaurants lose customers and their staff make less money. The decline spills over to the food supply chain.' He says China's catering industry saw revenue of more than 5.5 trillion yuan in 2024, supporting the livelihoods of over 30 million people. He says local governments must learn to distinguish between meals that violate the discipline rules and everyday meals; civil servants can drink a little in private meetings, as long as they can still perform their duties. Some commentators in Guizhou, home of many baijiu makers, including Kweichow Moutai, said the CCTV commentary clearly defined the drinking rules for civil servants. 'In 1985, the Soviet Union's strict alcohol ban resulted in a surge in bootleg liquor and social unrest,' a Guizhou-based writer says. 'The Gorbachev government shut down distilleries and raised prices, which fueled a black market. The policy failed due to high implementation costs.' 'This case serves as a lesson: policy implementation must balance rigid constraints with social realities, avoiding counterproductive effects caused by excessive intervention,' she says. She adds that the public has gradually come to understand that the alcohol ban should be reasonably implemented, allowing civil servants to maintain their everyday social lives. An analyst at the research unit of Guizhou Center Brewing Group says Beijing's core message is that officials should avoid drinking high-end liquor in meetings. At the same time, local governments should facilitate the general public's need to drink. 'The CCTV article encourages normal consumption of cheaper liquor, which refers to those that are tens of yuans per bottle,' he says. 'Small spirits brands would benefit if their marketing campaigns highlight warm-heartedness among friends and family.' On June 22, state media published a list of scenarios outlining when, where and how civil servants can drink. Civil servants are prohibited from attending eight types of banquets, including weddings, funerals and other similar events. They must remain vigilant when attending 12 formal or informal banquets that utilize public funds and government venues. Despite an alcohol ban for civil servants, demand among younger generation drinkers can help keep Chinese baijiu makers buoyant, analysts say. Industry analysis shows that men aged 35-55 remain the core consumer group of baijiu (over 52% ABV) in China, accounting for more than 65% of the spirits market. They are mainly senior corporate executives and government officials. Consumers aged 20-35 account for only 19% of the baijiu market. They prefer fruit punch and pre-mixed alcoholic drinks (6% to 16% ABV). Female drinkers account for 41% in this age group. A survey compiled by Wuliangye showed that only 19% of consumers aged 20-35 prefer baijiu, 52% fancy beer and 29% like foreign wine and fruit liquor. Wuliangye announced that it will launch a spirits product with 29% ABV for young consumers in the second half of this year. Luzhou Laojiao, a Sichuan-based liquor maker, said it developed a baijiu with 28% ABV and will launch products with 6% and 16% ABV. An industry report stated that China's spirits production fell by 13.33% to 650,000 kiloliters in 2024 compared to the previous year. It was the first decline recorded since 2019. However, the combined revenue of spirits makers grew 4.35% to 240 billion yuan ($34.3 billion), while their net profit rose 3.19% to 97 billion yuan. Although spirits makers no longer enjoy double-digit growth, they can maintain mild growth and buy time to explore new markets, the report said.
South China Morning Post
01-07-2025
- Business
- South China Morning Post
China's crackdown on banquets and booze dims spending outlook, Goldman Sachs says
Institutional investors are concerned that a ban on alcohol at official meals in mainland China could hamper Beijing's efforts to boost spending and juice up the economy, according to Goldman Sachs. Advertisement The recent alcohol ban at official meals, together with stricter enforcement of frugality rules by the Chinese Communist Party (CCP), had made mutual funds, private equity funds and asset managers worry about whether consumer spending would rebound, Goldman Sachs analysts led by Lisheng Wang said in a report on Sunday. Investors also fretted about whether economic stimulus policies would be effectively implemented, the investment bank said. In May, Beijing reiterated eight points that are a key part of President Xi Jinping's campaign to combat corruption and uphold integrity within the party. In the newly revised Regulations on Practicing Thrift and Opposing Waste in Party and Government Organs, the CCP required its more than 100 million members to adopt a more frugal lifestyle: no banquets, booze or cigarettes. Last week, the Central Commission for Discipline Inspection, China's top anti-corruption agency, reported that more than 21,000 violations were investigated nationwide in May, including offences related to the dining and alcohol bans. The austerity measures likely further suppressed consumption of certain goods and services, said Jing Wang, an analyst at Nomura, in a note on Monday. Advertisement Shares in distiller Kweichow Moutai, a brand synonymous with lavish banquets, fell more than 6 per cent over the past month. Wuliangye, another large distiller, suffered a 4 per cent decline during the same period. Both brands have already been affected by the country's sluggish economy; last year, UBS Group lowered its ratings on Kweichow Moutai and other major Chinese liquor distillers.
Yahoo
30-06-2025
- Business
- Yahoo
The 30-Year-Old Fund Manager Beating the Market with Blind Boxes and Anime Stocks
A 30-year-old Chinese fund manager is quietly outperforming nearly 2,300 peersby doing the opposite of what most expected. Xie Tianyuan, who took over the Penghua Selected Return Flexible Allocation Mixed Fund in early 2024, didn't waste time ditching old-school holdings like baijiu giant Kweichow Moutai. In their place? Stocks favored by China's Gen Z, like Pop Mart (PMRTY), Mao Geping Cosmetics, and Chongqing Baiya. His $7 million fund is up 24% this year, placing it in the top 3% of its class, per East Money data. Xie's bet? That cultural shifts and emotional spending habits could unlock non-linear growth in an economy otherwise stuck in low gear. Warning! GuruFocus has detected 5 Warning Sign with PMRTY. He's not just following trendshe's living them. A lifelong anime fan with a desk full of Dragon Ball Z figurines, Xie seems uniquely wired to spot the next viral IP brand before it hits mainstream radar. Pop Mart alone makes up 10.5% of his portfolio, the max allowed, driven by the breakout success of its Labubu blind-box dolls. Other picks tied to pet culture, cosmetics, and even yellow sparkling wine are benefiting from the same Gen Z-fueled demand. The strategy? Target companies with visually compelling products, unconventional sales channels, and brands that tug on consumer emotionnot just logic. Still, cracks may be forming. Pop Mart slipped after a state-run newspaper criticized blind-box products, and Laopu Goldup over 2,000% since IPOis facing pressure after its lock-up expired. Xie admits some names are pricing in 35 years of growth ahead of schedule. But he's not backing off. The gains may look incomprehensible to some people, he says, but it's actually all rooted in earnings. To him, the bigger story is just beginningwhere even legacy companies may be forced to reinvent themselves or risk getting left behind. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
News18
30-06-2025
- Business
- News18
Chinese Fund Manager, 30, Beats 97% Of Peers By Backing Labubu Dollmaker
Last Updated: Xie Tianyuan's fund returned 24 per cent so far this year, outperforming 97 per cent of nearly 2,300 mutual funds in China A young Chinese fund manager has shot to the top of investment rankings by backing Pop Mart, the maker of the wildly popular Labubu monster dolls. Xie Tianyuan's Penghua Selected Return Flexible Allocation Mixed Fund returned 24 per cent so far this year, outperforming 97 per cent of nearly 2,300 mutual funds in China, Bloomberg reported. After taking over the Shenzhen-based fund in 2024, Xie quickly shifted away from traditional holdings like liquor giant Kweichow Moutai, choosing instead to focus on trend-driven consumer brands that appeal to younger generations. He made Pop Mart his fund's biggest holding—10.5%, the maximum allowed. Xie's approach is rooted in what he calls 'emotional consumption," a rising trend among China's Gen Z shoppers who are drawn to visually appealing, fun products with personal meaning. His strategy also includes brands like Mao Geping Cosmetics—up 83% this year—pet food company Yantai China Pet Foods, and hygiene brand Chongqing Baiya, all popular with younger buyers. 'The line between what is considered 'old' and 'new' consumption is blurring, and more companies will join the new consumption pool once they realise that there's no future for them eking out a survival in their comfort zones. Even old trees can sprout new shoots," Xie said. Labubu dolls — small, fuzzy creatures with pointy teeth — have become a global hit. Sold in surprise 'blind boxes" for around $40, they've drawn huge crowds at stores in Asia, Europe, and North America. Celebrities like Rihanna and Cher have been seen with them, boosting their appeal even further. Pop Mart's rise reflects a wider wave of Chinese soft power, with cultural exports now gaining fans around the world. Despite concerns about China's global image, Labubu and other toys are reshaping perceptions and creating a new, trendier side of Chinese influence. The dolls have become so popular, they've sparked knock-offs and detailed online guides to spot fakes. Fans eagerly hunt for rare editions, and Pop Mart's success has inspired copycat brands known online as 'Lafufus". Location : China First Published:
