Huachuang Securities·2025-06-27 03:03Investment Rating - The report maintains a "Buy" recommendation for the liquor industry, specifically for leading companies in the sector [2]. Core Viewpoints - The liquor industry is currently undergoing extreme pressure testing due to weak demand and intensified policy enforcement, leading to an anticipated bottoming out around mid-year [12][19]. - It is suggested that leading liquor companies should lower their annual growth targets to stabilize pricing systems and build long-term brand value [7][22]. - The report emphasizes the importance of monitoring policy execution and the adjustment of annual targets by liquor companies as key indicators for market recovery [9][19]. Summary by Sections Industry Overview - The liquor industry is facing significant challenges, including a weak demand environment and strict policy enforcement that has led to a decline in consumption [12][13]. - The total market capitalization of the liquor sector is approximately 30,170.68 billion, with 20 listed companies [3]. Performance Metrics - The absolute performance of the liquor sector has declined by 5.8% over the past month, 8.8% over six months, and 6.0% over the past year [4]. Policy Impact - Recent government policies aimed at reducing waste and curbing extravagant spending have negatively impacted liquor consumption, particularly in the restaurant sector [12][13]. - The report notes that the execution of these policies has varied by region, with some areas experiencing stricter enforcement than others [14]. Investment Logic - The report identifies three perspectives on the safety margin for leading liquor companies: high dividend yields, low price-to-earnings ratios, and potential for increased institutional investment [8]. - Leading companies like Moutai and Wuliangye are highlighted for their strong market positions and attractive dividend yields, which exceed 4% [8]. Comparative Analysis - The report compares Moutai and Pop Mart, noting that both possess strong consumer, collectible, and financial attributes, but differ in demand elasticity and product matrix [24][27]. - Moutai's demand is driven by consumption and gifting, while Pop Mart relies on its IP-driven product strategy [25][27]. Investment Recommendations - The report suggests that investors should focus on acquiring shares of leading liquor companies during this strategic bottoming phase, as the long-term commercial attributes remain strong despite short-term pressures [7][8]. - Specific recommendations include Moutai, Gujing, and Wuliangye as primary targets for investment [8].