Core Viewpoint - The Chinese liquor industry is undergoing a significant adjustment period, with major companies reporting "growth under pressure" in their financial results for 2024 and Q1 2025, highlighting increased competition and market concentration [1][4]. Industry Overview - The white liquor industry is described as facing intensified competition, with a shift from "incremental competition" to "stock competition," leading to a consensus among leading companies that "value reconstruction" will be the main battleground moving forward [1][4]. - The production capacity of white liquor has decreased from a peak of 13.58 million kiloliters in 2016 to 4.145 million kiloliters in 2024, a decline of over 60% [4]. Company Strategies - Yanghe Distillery views 2024 as a year of adjustment, with major companies like Moutai and Wuliangye emphasizing stability in their growth targets, with Moutai setting a 9% growth target for 2025, down from the previous 15% [4][5]. - Yanghe Distillery has adopted a strategy of "active deceleration and inventory reduction," focusing on long-term stability rather than short-term sales growth [5][10]. Competitive Strength - Yanghe Distillery has built a robust product matrix covering all price ranges, which serves as a strong risk mitigation barrier, allowing the company to adapt to consumer segmentation trends and maintain stable operations amid industry fluctuations [5][10]. - The company is implementing six major initiatives to strengthen its foundation, including brand renewal, product optimization, and strategic market focus [8][9]. Financial Performance and Shareholder Returns - Despite facing challenges in revenue and profit, Yanghe Distillery announced a cash dividend plan of 3.49 billion yuan, with a total cash dividend of 7 billion yuan for 2024, reflecting a commitment to shareholder returns [11][12]. - The company has maintained a consistent dividend policy since its listing in 2009, with cumulative dividends amounting to 56.34 billion yuan, representing 72% of its cumulative net profit since listing [11][12].

Core Viewpoint - The Chinese liquor industry is undergoing a significant adjustment period, with major companies reporting "growth under pressure" in their financial results for 2024 and Q1 2025, highlighting increased competition and market concentration [1][3]. Industry Overview - The white liquor industry is described as facing intensified competition, with a shift from "incremental competition" to "stock competition," leading to a consensus among leading companies that "value reconstruction" will be the main battleground moving forward [1][3]. - The production capacity of white liquor has decreased from 1,358.4 million liters in 2016 to 414.5 million liters in 2024, a decline of over 60% [3]. Company Strategies - Yanghe Co. views 2024 as a year of adjustment, with many companies, including Moutai and Wuliangye, emphasizing stability in their growth targets for 2025 [3][4]. - Yanghe Co. has adopted a strategy of "active deceleration and inventory reduction," indicating a focus on long-term stability rather than short-term sales growth [3][4]. Competitive Resilience - Yanghe Co. has built a robust product matrix covering all price ranges, which serves as a strong risk mitigation strategy amid market fluctuations [4]. - The company is focusing on long-term strategies, prioritizing sustainable growth over immediate performance, and is implementing measures to control product supply and optimize market relationships [4][7]. Six Major Initiatives - At the recent T9 summit, industry leaders agreed on the need to "strengthen the foundation, reconstruct, and innovate," which Yanghe Co. has translated into six specific initiatives for 2025 [5][6]. - These initiatives include brand revitalization, product quality enhancement, and strategic market focus, particularly in key regions like the Yangtze River Delta and major cities [6][7]. Shareholder Returns - Despite facing challenges in revenue and profit, Yanghe Co. has proposed a cash dividend plan of 3.49 billion yuan for 2024, maintaining a strong commitment to shareholder returns [9]. - The company has consistently paid dividends since its listing in 2009, with cumulative dividends amounting to 56.34 billion yuan, representing 72% of its cumulative net profit [9][10].