KWEICHOW MOUTAI(SH:600519) Sou Hu Cai Jing·2025-05-19 11:37Core Viewpoint - The recent regulation prohibiting alcohol in official receptions has sparked concerns in the liquor market, but experts believe its impact on the Chinese liquor industry, particularly on Moutai, will be limited due to the already low proportion of government consumption in overall liquor sales [3][9][12]. Group 1: Regulatory Impact - The revised regulation from the Central Committee and State Council emphasizes frugality in official receptions, banning high-end dishes, cigarettes, and alcohol [4]. - Moutai's chairman, Zhang Deqin, expressed support for the new regulation, stating it encourages a return to the original purpose of Chinese liquor [7]. - Experts estimate that the proportion of government consumption in the liquor market is generally below 5%, indicating that the new regulation will not significantly affect overall liquor consumption [9][10]. Group 2: Market Reactions - Following the announcement of the regulation, shares of major liquor companies, including Moutai, fell, with Moutai's stock closing at 1578.98 yuan per share, down 2.18% [5]. - The market's reaction reflects historical concerns, as the introduction of similar regulations in 2012 led to a significant downturn in the liquor industry [8][9]. Group 3: Industry Outlook - The current cycle in the liquor industry is characterized by structural adjustments, with a focus on quality over quantity as companies adapt to changing consumer demands [13][16]. - Moutai's management emphasizes the importance of maintaining confidence in the brand's value and quality, which are seen as essential for navigating the current market challenges [14]. - Experts predict that the industry will undergo a "shuffling" process, with weaker regional brands likely exiting the market, while stronger brands like Moutai will continue to thrive [16].