Market Review - The food and beverage sector's ETFs showed significant divergence in November, with the wine ETF (512690.SH) and consumer ETF (159928.SZ) declining by -0.85% and -0.24% respectively, while the Hang Seng Consumer ETF (513970.SH) and another Hang Seng Consumer ETF (159699.SZ) increased by +1.78% and +1.45% respectively [2][12] - The Shanghai Composite Index fell by 1.67% in November, while the food and beverage sector rose by 0.84%, outperforming the Shanghai Composite by 2.52 percentage points [3][22] - The retail sales growth in October was 2.90%, marking a decline since May, with the food and beverage sector showing signs of recovery in certain sub-segments [4][32] Industry Dynamics - The white wine sector is currently in a downturn, with prices continuing to decline due to increased e-commerce platform subsidies and weak channel confidence, indicating a need for careful observation of inventory and pricing trends as the market approaches the 2026 Spring Festival [4][36] - The beer sector is also entering a slow season, with a focus on raw material pricing and new channel developments that could impact product structure [4][35] - The snack sector is highlighted as having strong supply chains that can optimize products and resonate with channels, making it a key area for potential growth [4][35] Investment Recommendations - The report maintains a "stronger than the market" outlook, emphasizing the food and beverage sector's importance in domestic demand recovery, supported by improving policy expectations [5][7] - Specific ETFs such as the Hang Seng Consumer ETF (159699.SZ) and the wine ETF (512690.SH) are recommended for capturing new consumption trends and potential rebounds in the sector [7][5] Sub-sector Performance - The processed food sub-sector saw the highest increase in November at +9.11%, while the soft drink sub-sector experienced the largest decline at -4.07% [25][22] - Year-to-date, the health products sub-sector has shown the highest growth at +10.80%, while the beer sub-sector has the largest decline at -11.18% [25][22] Macro Data Tracking - Retail sales in urban areas showed a year-on-year growth of 2.70% in October, while rural areas saw a growth of 4.10%, indicating a divergence in consumer spending trends [32][33] - The consumer confidence index fell to 89.40 in October, reflecting a decrease in consumer sentiment [33][34]

Investment Rating - The industry rating is maintained as "Positive" [6] Core Views - The current value of domestic demand is highlighted, with a focus on companies with strong financial reports and sustained fundamental momentum. New consumption trends favor snacks, while traditional consumption is recommended for companies showing signs of recovery [1][18] - The white liquor sector is expected to transition in 2025, with attention on leading companies that demonstrate good performance or effective reforms. The report emphasizes the importance of focusing on industry leaders during this phase [1][13] - Short-term investment opportunities in the consumer goods sector are driven by the snack category and new products launched in membership stores. Recommendations include companies like Salted Fish Pudding, Gan Yuan Food, and You Friend Food [1][18] Summary by Sections White Liquor Sector - The white liquor sector is currently at a low point, with the first quarter possibly being the lowest for the year. The report continues to recommend companies with strong brand momentum and reasonable growth targets [2][13] - The report identifies two main lines of investment: "sustained momentum" and "low base recovery." High-end liquor recommendations include Guizhou Moutai and Wuliangye, while mid-range and regional liquor recommendations include Gu Qingong and Shanxi Fenjiu [2][13] - The white liquor sector is expected to benefit from policy stabilization and real estate recovery, potentially leading to a structural bull market [2][13] Consumer Goods Sector - The consumer goods sector is experiencing a rebound, with a focus on snack companies benefiting from category dividends and new channels like membership supermarkets. Recommendations include leading companies such as Yili, Wanchen Group, and Qingdao Beer [2][18] - The report highlights the importance of seasonal stocking in beer and beverage sectors, as well as the retail transformation and cost cycle providing investment opportunities [1][18] Market Performance - From May 6 to May 9, the CSI 300 index rose by 2.00%, with other food sectors increasing by 3.37% and the white liquor sector by 2.38%. Notable performers in the white liquor sector included Huazhi Wine and Huangtai Wine [3][25] - The report notes that the white liquor sector's performance remains stable, with specific companies showing significant gains [4][25] Company Updates - Guizhou Moutai has undergone management changes, with Zhang Yixing becoming the brand ambassador for Moutai Culture and Tourism Company [5][7] - Wuliangye is implementing refined market strategies, with positive sales performance in various scenarios and a focus on maintaining brand position [8][9] - Jinshiyuan has optimized its organizational structure to enhance management efficiency and market presence [10][11]

Investment Rating - The industry rating is maintained as "Positive" [6] Core Views - The current value of domestic demand is highlighted, with a focus on companies with strong financial reports and sustained fundamentals. New consumption trends favor snacks, while traditional consumption is recommended for companies showing signs of recovery. The report emphasizes the strategy of "fishing in the domestic demand safe haven" and suggests prioritizing leading companies in the industry [1][23] - The report indicates that the liquor sector is in a transitional year for 2025, with a focus on companies with good fundamentals or those undergoing effective reforms. The report also highlights investment opportunities in snack companies and seasonal stocking in the beer and beverage sectors [1][2] Summary by Sections Liquor Sector - The liquor sector is currently at a low point, with the first quarter potentially being the lowest of the year. The report recommends focusing on brands with strong momentum and reasonable growth targets. The report suggests that the current external uncertainties, such as tariffs, enhance the value of domestic demand for liquor, potentially leading to a structural bull market in the sector [2][23] - Key recommendations include high-end liquor brands like Kweichow Moutai and Wuliangye, as well as regional brands like Gujing Gongjiu and Shanxi Fenjiu. The report also emphasizes the importance of "momentum continuation" and "low base recovery" strategies [2][23] Consumer Goods Sector - The consumer goods sector is experiencing a rebound, with a focus on snack companies benefiting from category dividends and new product launches in membership stores. The report continues to recommend seasonal stocking in the beer and beverage sectors, highlighting investment opportunities driven by retail transformation and cost cycles [1][27] - Recommended stocks include Salted Fish, Yili, Wanchen Group, Dongpeng Beverage, Qingdao Beer (A+H), Three Squirrels, and others [1][27] Performance Metrics - The liquor industry saw a revenue growth of 7.7% and a net profit growth of 7.56% in 2024. In Q1 2025, the industry reported a revenue growth of 1.8% and a net profit growth of 2.25%. The report suggests that the industry is currently in a bottom adjustment phase, with leading companies successfully navigating pressure tests [7][19] - Specific company performance includes Kweichow Moutai achieving a revenue of 514.43 billion yuan in Q1 2025, a growth of 10.67%, and a net profit of 268.47 billion yuan, a growth of 11.56% [17] Market Trends - The report notes that the overall valuation of the food and beverage industry has adjusted, with the industry trading at 21.79 times earnings. The liquor sector's valuation is at 19.69 times, while beer and wine are at 27.67 and 74.88 times, respectively [39] - The report also tracks price trends for key liquor brands, indicating stability in prices for Kweichow Moutai and Wuliangye [22][54]