Haitong Securities International·2025-04-02 12:44Investment Focus - The report highlights a positive outlook for key companies in the food and beverage sector, recommending an "Outperform" rating for several leading brands including Guizhou Moutai, Wuliangye, and Eastroc Beverage [1] - The report emphasizes the importance of essential consumption as a stable investment opportunity amidst economic uncertainties [8] Industry Overview - In March 2025, five out of eight tracked industries showed positive growth, with frozen food (+4.0%), dining (+2.5%), soft drinks (+2.2%), condiments (+1.0%), and beer (+0.7%) experiencing growth, while high-end liquor (-6.9%) and dairy products (-3.5%) faced declines [4][10] - The report notes a significant decline in revenue for mass-market liquor, which saw a drop of 12.5% in March 2025 [10][12] Pricing Trends - The report indicates a continued decline in the price of premium liquor, with Moutai's price dropping by 10 yuan in March, totaling a decrease of 470 yuan compared to the previous year [5][22] - Conversely, Wuliangye has managed to maintain its price, with a slight increase of 10 yuan in March [22] Cost Analysis - The report shows a general decrease in consumer goods costs in March, with soft drinks, instant noodles, beer, dairy products, condiments, and frozen foods all experiencing declines in their cost indices [6] - The price of palm oil has significantly decreased, while grain prices continue to rise, indicating mixed trends in raw material costs [6] Valuation Insights - As of the end of March, the PE historical percentile for A-share food and beverage companies was 18%, reflecting a slight increase from the previous month [7] - The report notes that leading companies in the sector have a median valuation of 21x, indicating a stable investment environment [7] Recommendations - The report suggests focusing on essential consumption sectors such as dairy, soft drinks, and liquor, highlighting specific companies like China Feihe, Mengniu Dairy, and Kweichow Moutai as potential investment opportunities [8]