Investment Rating - The investment rating for the company is "Accumulate" (maintained) [5] Core Views - The report suggests that the fundamentals may have bottomed out, and the company is waiting for demand recovery. The Anhui province, being a traditional stronghold for liquor production and sales, is expected to see continued growth in the liquor market despite consumption downgrading. The projected market size for Anhui's liquor market in 2024 is approximately 400 billion RMB, supported by the province's active private economy and strong per capita drinking capacity [5][25]. Summary by Sections Market Performance - The closing price of the company is 40.45 RMB, with a market capitalization of 32,360 million RMB. The one-year high and low prices are 69.00 RMB and 37.79 RMB, respectively. The company has a total share capital of 800 million shares and a debt-to-asset ratio of 22.09% [3]. Profit Forecast and Valuation - The company’s net profit attributable to shareholders is forecasted to be 21.32 billion RMB, 22.58 billion RMB, and 24.61 billion RMB for the years 2025 to 2027, corresponding to P/E ratios of 15, 14, and 13 times, respectively. The company is expected to show resilience in revenue and net profit due to solid channel management and brand recognition in Anhui, with room for market expansion [7][10][48]. Strategic Product Line and Channel Development - The company has successfully positioned itself in the mid-to-high-end market, focusing on price bands above 150 RMB, which aligns with the consumption upgrade trend in Anhui. The introduction of the "Cave" series has significantly improved the product structure and market share. The company employs a deep distribution model that covers both core cities and lower-tier markets, enhancing its competitive edge [9][39][37]. Economic Environment and Market Dynamics - The Anhui province's economy has shown robust growth, with GDP increasing from 3,125.3 billion RMB in 2000 to 50,625.2 billion RMB in 2024. The active private economy in Anhui contributes significantly to the liquor market's resilience, with private enterprises accounting for 60.7% of the province's GDP and 59.7% of tax revenue [25][29]. Financial Performance and Ratios - The company’s revenue for 2025 is projected to be 6,225 million RMB, reflecting a year-on-year decline of 15.23%. However, the revenue is expected to recover with growth rates of 2.71% and 6.11% in 2026 and 2027, respectively. The gross margin is anticipated to remain strong, with a net profit margin of 35.33% in 2024 [8][48].