Performance Summary - In Q3 2025, the company's operating revenue, net profit attributable to the parent, and net profit excluding non-recurring items were 2.545 billion, 299 million, and 282 million yuan respectively, showing year-on-year declines of 51.65%, 74.56%, and 75.71% [1] Industry Insights - The "peak season effect" has weakened, with an expected overall decline in liquor sales of 20%-30% during the Mid-Autumn Festival and National Day holidays. The "ban on alcohol" in May has significantly impacted the consumption scenarios for government and business-related liquor, leading to a subdued restaurant consumption market. The market atmosphere during the "double festival" is relatively flat, prompting the company to moderately lower payment collection requirements to manage risks and alleviate channel pressure, thereby preparing for a strong start in the coming year [2] Financial Analysis - The company's gross margin and net margin in Q3 2025 increased by 1.96 and decreased by 11.12 percentage points to 79.83% and 12.02% respectively. The increase in gross margin is likely due to a higher proportion of mid-to-high-priced products, while the decline in net margin is primarily attributed to a significant rise in expense ratios. The sales expense ratio, management expense ratio (including R&D), and financial expense ratio increased by 16.14, 6.25, and -4.16 percentage points to 39.14%, 12.67%, and -4.61% respectively. The substantial increase in sales expenses is likely due to rigid promotional and advertising expenditures, coupled with a sharp decline in revenue leading to higher expense ratios. As of Q3 2025, contract liabilities changed by -0.84 and -5.92 billion yuan year-on-year and quarter-on-quarter to 1.344 billion yuan, indicating the company's focus on channel health without excessive shipments. Operating cash flow turned negative at -1.527 billion yuan [3] Investment Outlook - The company, as a leading player in the Huizhou liquor market, has a solid domestic foundation. In Q3 2025, the company is releasing pressure from the slowdown, preparing for a strong start in the coming year. The profit forecast has been moderately adjusted, with expected net profits attributable to the parent for 2025-2027 being 4.643 billion, 5.212 billion, and 5.901 billion yuan respectively, down from previous estimates of 5.620 billion, 6.002 billion, and 6.810 billion yuan. The "buy" rating is maintained [3]