Investment Rating - The industry investment rating is "Positive" (maintained) [1] Core Insights - The food and beverage sector is currently at a low position in terms of valuation and fundamentals, presenting significant layout value. The CPI in December 2025 increased by 0.8%, indicating a mild recovery trend. The policy focus on expanding domestic demand and promoting consumption is becoming clearer, signaling a potential bottoming out of industry demand. The current valuation and policy bottom are resonating, gradually releasing pessimistic expectations and providing a safety margin for investment [7][35] - The upcoming Spring Festival is expected to catalyze performance in the sector, with resilient demand for consumer goods and a continuous upward trend in the snack sector. The mismatch in the timing of the Spring Festival is anticipated to lead to a concentrated release of stocking demand. The sector is expected to achieve rapid growth in Q1 2026 [7][35] Summary by Sections Fund Positioning - In Q4 2025, the allocation ratio for food and beverage in the overall market funds dropped to a new low of 6.1%, down from 6.4% in Q3 2025. The allocation ratio for active equity funds was 4.0%, slightly down from 4.1% in the previous quarter, indicating a continued reduction in food and beverage allocations by active equity funds [4][13] - The overall number of shares held by funds in the food and beverage sector decreased in Q4 2025, with a general trend of reduced allocation to food and beverage companies. Notably, companies like Yurun Agriculture, Yili, and West Wheat Food saw an increase in market value held by funds, while companies like Wuliangye, Shanxi Fenjiu, and Kweichow Moutai experienced significant decreases [6][29][32] Investment Recommendations - The report suggests focusing on two main lines for investment: first, consider companies like Shede Liquor that have undergone sufficient adjustments and possess high elasticity; second, allocate to industry leaders such as Kweichow Moutai and Shanxi Fenjiu, which have strong performance stability and risk resistance. The Spring Festival stocking is expected to be a core catalyst for the sector's performance [7][34] - Specific investment opportunities are highlighted in three sub-sectors: raw milk/dairy products, the snack sector, and the catering supply chain. Companies such as Wei Long, Gan Yuan Food, Yan Jin Pu Zi, West Wheat Food, and Yili are identified as key investment targets, with beneficiaries including Yurun Agriculture, Mengniu Dairy, Anjixin Food, and Guoquan [7][38]