Core Viewpoint - The "Double 11" sales event for liquor this year has revealed significant price drops and a concentrated reconciliation of channel systems, exceeding industry expectations [2][3]. Group 1: Market Dynamics - This year's "Double 11" saw a deeper discounting trend compared to previous years, indicating a release of pent-up emotions within the market [4]. - The core product of Jian Nan Chun, the Crystal Sword, experienced a notable decline in price despite maintaining high sales volume on platforms like Tmall and Meituan [5][6]. - The price of the Crystal Sword fell to around 350 RMB, significantly below its factory price of 410 RMB, due to aggressive subsidies and promotions from various platforms [5][10]. Group 2: Channel and Inventory Issues - The traditional speculative logic in channel management, where products were considered "safe bricks" for investment, has failed during this year's "Double 11" [7]. - Many orders for the Crystal Sword on platforms like Douyin remained unfulfilled post "Double 11," leading to financial losses for resellers who had anticipated selling at a profit [8][9]. - The market in Ningbo, a key area for the Crystal Sword, has seen rapid price changes due to its transparent channel network and high liquidity [12][13]. Group 3: Financial Performance and Challenges - Jian Nan Chun's revenue for 2024 is projected at 16.94 billion RMB, with a growth rate of only 3.74%, a significant decline from the previous year's 13.55% [28]. - Achieving the ambitious revenue target of 30 billion RMB by 2025 would require a staggering 77.1% year-on-year growth, which is challenging given the current market conditions [28]. - The brand's growth remains heavily reliant on the Crystal Sword, while its high-end product lines have not yet established a stable consumer base [28][29]. Group 4: Strategic Outlook - The liquor industry is shifting from growth to structural adjustment, with increasing pressure on mid-range price segments and tighter price linkages between e-commerce and offline channels [31]. - Jian Nan Chun faces critical questions regarding restoring channel confidence, re-establishing price order, and ensuring that distributors do not experience repeated concentrated sell-offs [31]. - The ability of Jian Nan Chun to leverage the sales momentum from "Double 11" to enhance brand competitiveness remains to be seen [31].

Investment Rating - The report maintains an investment rating of "Recommended" for the food and beverage industry [3][8]. Core Insights - The food and beverage industry experienced a slight revenue increase of 0.17% year-on-year in the first three quarters of 2025, but the net profit attributable to shareholders declined by 4.58% [3][15]. - The third quarter of 2025 saw a significant decline in both revenue and profit, with revenues dropping by 4.75% year-on-year and net profits decreasing by 14.61% [3][15]. - The report highlights that the macroeconomic policies aimed at boosting domestic demand are expected to lead to a recovery in performance and valuation for the food and beverage sector [16]. Summary by Sections 1. Industry Overview - The food and beverage sector's overall revenue for the first three quarters of 2025 was CNY 8309.16 billion, with a net profit of CNY 1711.64 billion [3][15]. - The third quarter alone generated revenue of CNY 2500.62 billion, with a net profit of CNY 434.96 billion [3][15]. 2. Subsector Performance 2.1 Baijiu (Chinese liquor) - The baijiu sector faced significant pressure, with revenues and net profits declining in the third quarter of 2025 [24]. - Major brands like Moutai and Fenjiu performed relatively well despite the overall downturn [24]. - The report notes a 20%-30% decline in sales during traditional festive periods, with regional variations in performance [24]. 2.2 Beer - The beer sector maintained steady demand, achieving a revenue of CNY 620.52 billion in the first three quarters, up 2.02% year-on-year, and a net profit of CNY 94.84 billion, up 11.82% [29]. - The third quarter saw revenues of CNY 203.20 billion, with a net profit increase of 11.30% [29]. 2.3 Snacks - The snack sector showed positive growth, with revenues and net profits increasing in the third quarter [3][29]. 2.4 Soft Drinks - The soft drink sector experienced a strong performance, particularly in the third quarter, with leading companies showing significant growth [3][29]. 2.5 Dairy Products - The dairy sector continued to face demand challenges, but there were signs of marginal improvement as raw milk prices stabilized [4][29]. 2.6 Condiments - The condiment sector is undergoing intense competition, but leading companies are outperforming the overall market [4][29]. 3. Investment Recommendations - The report suggests focusing on resilient companies with strong growth potential, such as Dongpeng Beverage, Yili, and Moutai, among others [8][24].

Core Viewpoint - The price of Feitian Moutai has dropped to 1499 yuan, raising concerns about the future of the liquor industry, but it is important to recognize that Moutai is just one brand in a vast industry worth nearly 800 billion yuan, and its price fluctuations do not solely dictate the health of the entire sector [3][4][6]. Industry Impact - The drop in Feitian Moutai's price is attributed to e-commerce promotions and market changes, leading to a potential "domino effect" that could pressure other products in the industry [4][6]. - The offline retail price of Feitian Moutai remains around 1800 yuan, close to the breakeven point for distributors, indicating that further price declines could lead to negative operating conditions for them [4][6]. - The liquor industry is experiencing a cooling trend, with the third quarter showing poor performance, which may continue to affect market dynamics [6][9]. Strategic Adjustments - Moutai has implemented measures to manage market prices, aiming to maintain a price above 1800 yuan, despite the recent price drop [7][9]. - The company has reduced production for 2024, with an expected output of approximately 56,300 tons, marking a decrease of about 900 tons year-on-year, indicating a strategic shift in response to market conditions [9]. Consumer Trends - The consumer base is evolving, with younger generations (80s and 90s) becoming the main consumers, leading to a diversification of demand beyond just high-priced products [10][11]. - Other brands, such as Boliang and Shuijingfang, are gaining popularity due to their affordability and quality, suggesting that price is not the only factor influencing consumer choices [15][18]. Market Outlook - The liquor industry is expected to undergo significant changes as it adapts to new consumer preferences and market conditions, with a focus on quality and cultural value rather than just price [10][11]. - Despite the challenges posed by price fluctuations of high-end products like Feitian Moutai, the overall liquor market remains resilient, with opportunities for growth in various segments [18][19].

Core Insights - The article discusses the evolving dynamics of the liquor market during the Double Eleven shopping festival, highlighting the rise of "lujiu" (a term for hunting for discounted liquor) communities on social media and the impact of aggressive e-commerce promotions on traditional pricing strategies [1][10][11]. Group 1: Market Trends - E-commerce platforms are experiencing a promotional battle, with significant discounts on premium liquors such as Moutai, which is being sold for as low as 1499 yuan during the Double Eleven event [1][11]. - The traditional practice of stockpiling liquor is declining as younger consumers shift towards immediate consumption rather than bulk buying [10][16]. - The percentage of new customers on liquor platforms has surged, with 70% of new customers on Tmall being under 30 years old, indicating a shift in consumer demographics [11]. Group 2: Community Dynamics - Active "lujiu" communities have formed on platforms like Xiaohongshu and WeChat, where users share tips and strategies for securing discounted liquor [3][5]. - These communities have grown rapidly, with one group amassing nearly 500 members in a month, showcasing the demand for discounted liquor [3][5]. Group 3: Pricing and Competition - The aggressive pricing strategies employed by e-commerce platforms are disrupting traditional pricing structures, leading to a significant decline in profit margins for liquor manufacturers [11][15]. - Major liquor brands are struggling to maintain pricing power as e-commerce subsidies and promotions create price disparities between online and offline sales [15][16]. - The competition among platforms has intensified, with companies like JD.com and Pinduoduo implementing various promotional strategies to attract consumers [1][11]. Group 4: Industry Adjustments - Liquor companies are adapting to the new market realities by ceasing low-price promotions, as the profitability of such strategies has diminished [11][15]. - The industry is undergoing a transformation, with a focus on immediate consumption and a reduction in the emphasis on bulk purchasing [16][17]. - The rise of instant retail and the shift in consumer behavior are accelerating the end of the traditional liquor sales model centered around stockpiling [16][17].

Core Viewpoint - The Chinese liquor industry is facing a severe downturn, with high inventory levels and weak consumer demand leading to a vicious cycle of price declines and industry consolidation, contradicting previous expectations of a rebound [3][5]. Financial Performance - By Q3 2025, the liquor industry has seen a significant divergence, with only a few leading companies maintaining growth while most mid-tier and regional brands experience declines in both revenue and profit [7]. - Kweichow Moutai reported a revenue of 130.9 billion yuan, a year-on-year increase of 6.32%, but its growth momentum has weakened significantly compared to previous years [8]. - Second-tier brands like Wuliangye and Luzhou Laojiao are under pressure, with Wuliangye's revenue down 10.26% and Luzhou Laojiao's down 4.84% year-on-year [9][10]. - Lower-tier and regional brands are facing severe losses, with companies like Yanghe and Jiu Gui reporting significant declines in revenue and profits [10]. Industry Dynamics - As of November 1, 2025, the industry dynamics continue to worsen, with no progress in inventory reduction and a collapsing price system [13]. - The price of high-end liquor has dropped significantly, with Moutai's price falling over 28% since the beginning of the year [14]. - Inventory levels are high, with Moutai's inventory turnover days reaching 995 days, indicating a prolonged inventory clearance period [11][15]. - Demand remains weak, with traditional consumption scenarios shrinking and younger consumers shifting towards lower-alcohol beverages [16]. Bottoming Indicators - The industry is far from confirming a bottom, with significant gaps in inventory reduction, price stabilization, demand transformation, competitive landscape, policy support, and valuation [18]. - Current inventory turnover days exceed 900 days, far above the target of 300 days, indicating a lengthy clearance process ahead [19]. - Price stabilization signals are absent, with Moutai's price still significantly below the target [20]. - Demand transformation is lacking, with the share of young consumers and low-alcohol products not meeting necessary thresholds [22]. Historical Context - The liquor industry has experienced two major crises in the past 30 years, both characterized by demand shrinkage, inventory buildup, price declines, and industry consolidation [27]. - The first crisis (1998-2004) was driven by external shocks and resulted in a prolonged adjustment period, while the second crisis (2012-2015) was more structural, leading to a quicker recovery [30]. - Current conditions suggest that the ongoing crisis is deeper and more complex than previous ones, with a projected bottoming period extending to around 2027 [31]. International Comparisons - Global spirits industries have faced similar crises, with recovery paths providing valuable insights for the Chinese liquor sector [34]. - The Scottish whisky industry, for example, successfully managed inventory through production cuts and market expansion, contrasting with the current reliance on price cuts in the Chinese market [36]. - Japanese sake underwent significant transformation through product innovation and cultural integration, highlighting the need for the Chinese liquor industry to adapt to changing consumer preferences [39][41]. Future Outlook - The Chinese liquor industry must meet specific conditions to confirm a bottom, including reducing inventory turnover to below 300 days and increasing the share of low-alcohol products to 30% [48]. - A successful transformation will require a focus on product innovation, digital channel development, and cultural engagement to attract younger consumers [49]. - The industry must avoid the pitfalls of prioritizing scale over value, as past strategies of simple expansion and price cuts have proven unsustainable [50].

Group 1 - The introduction of the specialized and innovative index, steady progress in new stock issuance, and more mergers and acquisitions are expected to maintain high trading activity and market attention on the Beijing Stock Exchange, indicating long-term investment value in this sector [1] - For the investment strategy in the second half of 2025, two main directions are recommended: 1) a top-down focus on new productive forces in emerging industries such as artificial intelligence, commercial aerospace, low-altitude economy, and new consumption, particularly companies with "scarce" business models and main products in the A-share market; 2) a bottom-up selection based on financial indicators, focusing on companies with high performance growth, strong R&D investment, significant capacity release potential, and strong growth [1] - The top five sectors with net inflows include military industry, new energy vehicles, PCB boards, domestic software, and automotive parts; the top five concepts with net inflows include artificial intelligence, military-civilian integration, humanoid robots, Huawei industry chain, and leading companies going overseas; the top ten individual stocks with net inflows include Sanhua Intelligent Control, Zhongji Xuchuang, Kingsoft Office, Xinyisheng, Founder Technology, Zhaoyi Innovation, Great Wall Military Industry, Xiamen Tungsten, Dongfang Wealth, and Jingrui Electric Materials [1] Group 2 - Gold prices have surged rapidly due to rising expectations of interest rate cuts by the Federal Reserve, the potential government shutdown in the U.S. prompting safe-haven trading, and geopolitical disturbances from Venezuela, which may drive short-term price increases [3] - Despite the short-term factors eventually dissipating, the long-term bullish fundamentals for gold remain unchanged, with updated models indicating that gold prices could exceed $4,500 per ounce in Q1 of next year under neutral assumptions [3] - The precious metals market is currently in a speculative-driven phase, with sentiment determining the final price levels and paths; while the current market is favorable for holders, new investors are advised to wait for adjustments or focus on day trading due to increased volatility risks following rapid price increases [4] Group 3 - During the double festival period, the overall sales of liquor declined by 20%-30%, with significant regional disparities; traditional liquor consumption provinces like Henan, Shandong, and Jiangsu performed relatively well, while Guangdong and Anhui saw declines exceeding 20% [6] - Leading liquor brands performed better, with stable sales for products like Moutai 1935, Fenjiu series, Honghualang, and Shuijingfang, while high-end business-oriented products were more significantly affected [6] - Looking ahead, the domestic economy is expected to gradually stabilize and recover, suggesting that cyclical industries like liquor may re-enter a high growth phase, presenting opportunities for investment at current low levels [6]

Group 1 - The three major indices opened lower, while the food and beverage sector rose, with the CSI Food and Beverage Index increasing by 0.2% [1] - Key stocks in the food and beverage sector included Keta Bio, which rose over 12%, Shuangta Food, which increased nearly 8%, and Angel Yeast, which rose nearly 2% [1] - The CSI A500 Index fell by 0.39%, with notable increases in stocks such as Robotech, which rose nearly 5%, and Fihua, which increased over 4% [1] Group 2 - The Tianhong Food and Beverage ETF (159736) experienced a net inflow of 50.69 million yuan over five consecutive trading days, with a total circulation of 7.768 billion shares and a market size of 5.599 billion yuan [1] - The Tianhong A500 ETF (159360) saw a decline of 0.32%, with a circulation of 1.388 billion shares and a market size of 1.714 billion yuan [1] Group 3 - Yanjing Beer reported a third-quarter revenue of 13.433 billion yuan, a year-on-year increase of 4.57%, and a net profit of 1.770 billion yuan, up 37.45% year-on-year [1] Group 4 - The iMoutai APP announced that consumers can purchase the 53% vol 500ml Guizhou Moutai liquor without a reservation starting October 20, with limited quantities available [2] - According to feedback, the market for Moutai liquor remained stable from June to August, with a significant recovery in sales in September [2] - During the double festival period, overall white liquor sales declined by 20%-30%, with regional variations noted, particularly in traditional consumption provinces [2] - High-end liquor brands performed relatively well, with stable sales for Moutai 1935 and other premium products [2] - The domestic economy is expected to gradually stabilize, suggesting a potential return to high growth for the white liquor industry [2] Group 5 - The Tianhong Food and Beverage ETF closely tracks the CSI Food and Beverage Index, which selects stocks from the beverage, packaged food, and meat industries [3] - The top holdings in the Tianhong Food and Beverage ETF include major companies like Guizhou Moutai, Yili, Wuliangye, and others [3] - The Tianhong A500 ETF tracks the CSI A500 Index, which includes 500 large-cap, liquid securities from various industries [3]

Core Viewpoint - The overall sales of white liquor during the holiday period have declined by 20%-30%, with significant regional disparities observed [1] Regional Performance - Traditional white liquor consumption provinces such as Henan, Shandong, and Jiangsu showed relatively stable performance, with sales decline better than the national average [1] - In contrast, regions like Guangdong and Anhui experienced a sales decline exceeding 20% [1] Brand Performance - Leading brands such as Moutai 1935, Fenjiu series, Honghualang, and Shuijingfang maintained stable shipment volumes across multiple regions [1] - High-end business-oriented products were more significantly affected by the sales decline [1] Future Outlook - The domestic economy is expected to gradually stabilize and recover, which may lead to a resurgence in high growth for cyclical industries like white liquor [1] - Current low valuation presents an opportunity for strategic investment [1]

Core Viewpoint - The report from CITIC Securities indicates a significant decline in the sales of liquor during the National Day and Mid-Autumn Festival holidays, with an overall drop of 20%-30% in the white liquor market [1] Regional Performance - There is a notable regional disparity in sales performance: traditional liquor consumption provinces such as Henan, Shandong, and Jiangsu showed a relatively stable performance, with declines less severe than the national average [1] - In contrast, provinces like Guangdong and Anhui experienced a sales decline exceeding 20% [1] Brand Performance - Leading liquor brands performed relatively well, with stable sales for products like Moutai 1935, Fenjiu series, Honghualang, and Shuijingfang across multiple regions [1] - High-end business-oriented products were more significantly impacted by the sales decline [1] Future Outlook - The domestic economy is expected to gradually stabilize and recover, suggesting that cyclical industries like liquor may re-enter a high growth phase [1] - It is recommended to take advantage of the current low valuation opportunities for investment [1]

Group 1 - The A-share market indices collectively rose in early trading on October 15, with the Tianhong Food and Beverage ETF (159736) increasing by 0.28% and trading volume exceeding 11 million yuan [1] - The Tianhong Food and Beverage ETF closely tracks the CSI Food and Beverage Index, which selects stocks from the beverage, packaged food, and meat industries, including major companies like Kweichow Moutai and Yili [1] - Notable stocks within the ETF saw significant gains, with Yanjinpuzi rising nearly 6%, and other stocks like Baba Foods, Jindawei, and Bairun shares also experiencing upward movement [1] Group 2 - Guojin Securities suggests focusing on left-side allocation opportunities in the liquor sector, noting that while valuations have improved since late June, this is primarily due to liquidity improvements rather than fundamental enhancements [2] - The report indicates that the liquor sector is experiencing a gradual release of apparent performance pressure, with expectations of overseas interest rate cuts and improved seasonal sales feedback [2] - The current period is seen as a favorable policy window, leading to a positive outlook on the allocation value of the liquor sector [2]