SCSF(SH:600779) Xin Lang Cai Jing·2025-06-18 13:33Core Viewpoint - The management of Shui Jing Fang expresses confidence in the long-term development of the liquor industry despite short-term pressures and the impact of the "ban on excessive dining" still being under observation [1][2]. Group 1: Company Performance and Strategy - Shui Jing Fang plans to increase the number of stores by 20% in key cities such as Chengdu and Nanjing to enhance performance [1]. - The company is advancing its "Thousand Cities, Ten Thousand Stores" initiative, focusing on expanding into third- and fourth-tier cities and county markets, with over 10,000 new stores opened last year and approximately 24,000 new effective stores in Q1 2025 [2]. - In Q1 2025, Shui Jing Fang reported revenue of 959 million yuan, a year-on-year increase of 2.74%, and a net profit of 190 million yuan, up 23.63% year-on-year [2]. Group 2: Inventory Management - The management acknowledges an increase in channel inventory as of the end of Q1 2025, but asserts that it remains at a reasonable level [2]. - Shui Jing Fang is one of the few liquor companies that considers channel inventory levels as a core KPI for management assessment [2][3]. - The company initiated inventory reduction in Q1 2023, being one of the first in the industry to do so, which has led to intensified competition among liquor companies [3]. Group 3: Market Environment and Challenges - The management reflects on the competitive landscape, noting that many companies are now pursuing inventory reduction, which has increased market competition [3]. - The general manager emphasizes the importance of focusing on brand, product upgrades, and team building during challenging market conditions, likening business management to driving in adverse weather [3].