Core Insights - The beer sales are being tested due to weak consumption in on-premise channels like dining and nightlife [1][2] - Both Chongqing Beer and Budweiser APAC reported declines in revenue and profit in their recent financial results [1][4] Group 1: Financial Performance - Chongqing Beer reported a revenue of 8.839 billion yuan in the first half of the year, a slight decrease of 0.24% year-on-year, with a net profit of 865 million yuan, down 4.03% [1] - Budweiser APAC's revenue for the first half of the year was 3.136 billion USD, reflecting a 5.6% decline year-on-year, with a 7.4% drop in sales volume in China during Q2 [1][4] Group 2: Market Trends - The production of beer by large-scale enterprises in China decreased by 0.3% year-on-year, totaling 19.044 million kiloliters in the first half of the year [2] - Despite the weak on-premise sales, the high-end beer segment continues to grow, with Chongqing Beer reporting that high-end beer (priced above 8 yuan) accounted for the highest revenue share at 5.265 billion yuan, a slight increase of 0.04% [2] Group 3: Strategic Initiatives - Chongqing Beer is focusing on expanding its non-on-premise market by optimizing product structure and increasing the proportion of canned products, achieving a nearly 29% increase in canning rate for non-on-premise channels [3] - The company launched nearly 30 new products in the first half of the year, including craft beers and flavored beverages, to cater to diverse consumer preferences [3] - Budweiser APAC is also enhancing its non-on-premise channel strategy, with a focus on high-end products, and has seen growth in sales and revenue contributions from this segment [4]

Core Viewpoint - Beer manufacturers are increasingly focusing on non-on-trade markets such as instant retail due to weak performance in on-trade channels like restaurants and nightlife [1][2][3] Group 1: Company Performance - Chongqing Beer reported a revenue of 8.839 billion yuan in the first half of the year, a slight decrease of 0.24% year-on-year, with a net profit of 865 million yuan, down 4.03% [2] - Budweiser APAC's second-quarter sales in China fell by 7.4%, with revenue down 6.4%, leading to a total revenue of 3.136 billion USD in the first half, a decline of 5.6% year-on-year [2] - The National Bureau of Statistics reported a 0.3% year-on-year decline in beer production among large-scale breweries in China, totaling 19.044 million kiloliters in the first half of the year [3] Group 2: Market Trends - Despite weak on-trade sales, the high-end beer segment continues to grow, with Chongqing Beer’s high-end products (priced above 8 yuan) generating 5.265 billion yuan, a slight increase of 0.04% [3] - Chongqing Beer’s revenue per 100 liters of beer decreased by 1.2% year-on-year to 491 yuan, while beer sales volume increased by 0.95% to 1.8 million kiloliters [3] - The Northwest region remains a strong revenue source for Chongqing Beer, with a 1.75% year-on-year growth to 2.596 billion yuan, while the Central and Southern regions saw declines of 0.7% and 1.47% respectively [3] Group 3: Strategic Initiatives - Companies are enhancing their product offerings and expanding into non-on-trade channels, with Chongqing Beer launching nearly 30 new products and various new packaging options in the first half of the year [5][6] - Chongqing Beer has seen a nearly 29% increase in the canning rate for non-on-trade channels, with brands like Wusu, 1664, and Carlsberg showing double-digit growth in canning rates [6] - Budweiser APAC is focusing on high-end products in non-on-trade channels, with sales and revenue contributions from these channels expected to grow by the first half of 2025 [6]