Core Viewpoint - The white liquor industry, once a symbol of investment confidence, is now facing significant challenges, with many brands struggling to keep up with market demands and experiencing declining performance [1][3]. Industry Overview - The white liquor sector was previously regarded as a "faith asset" in the A-share market, with leading brands like Moutai being highly revered and their stock prices soaring [1]. - Over the past few years, the industry has seen a dramatic shift, with overcapacity and weak sales becoming apparent, leading to price declines and stagnant growth [1][3]. Current Performance - Recent reports indicate that during the National Day and Mid-Autumn Festival, liquor sales dropped by approximately 15% to 20% year-on-year, highlighting the intense competition and ongoing market pressures [3]. - First-tier brands like Moutai and Wuliangye have managed to maintain slight growth, while second-tier brands are facing revenue declines and profit reductions [1][3]. Investment Trends - Despite the negative outlook for white liquor stocks, there has been a notable increase in investment, with the circulation of liquor ETFs nearly doubling from 185 billion to 344.68 billion shares since May [3]. - This indicates that a segment of investors continues to support these "old stocks," suggesting a potential for recovery despite current challenges [3]. Future Outlook - The future of "old stocks" like those in the white liquor industry may depend on their ability to adapt to changing consumer preferences, such as exploring low-alcohol beverages and digital marketing strategies [6]. - The industry still possesses strong brand loyalty and cash flow, which could provide a foundation for recovery if companies can innovate and connect with younger consumers [6].

Summary of Key Points from Conference Call Industry Overview - The conference call discusses the performance and strategies of the A-share ETF market in China, particularly focusing on the actions of the national team and the macroeconomic environment affecting the market [1][2][14]. Core Insights and Arguments - **ETF Holdings and Changes**: As of mid-2025, the national team holds approximately 1.3 trillion RMB in A-share ETFs, representing 42% of the total market size, an increase of about 5 percentage points from the end of the previous year. Significant increases were noted in broad-based ETFs, particularly the CSI 300, which saw an increase of over 30 billion shares [2][14]. - **Sector Performance**: The national team increased holdings in sectors such as pharmaceuticals and liquor while reducing positions in healthcare, food and beverage, and 5G communication ETFs. Notably, the chemical and liquor ETFs experienced substantial net inflows in August [2][14]. - **Market Liquidity**: The central bank maintained a net injection of nearly 500 billion RMB, with a focus on MLF operations, leading to a slight increase in money market rates. The credit spread narrowed by approximately 4 basis points [5]. - **Stock Market Activity**: The overall A-share market saw a 1.9% increase, with daily trading volumes approaching 3 trillion RMB. Net inflows into the market reached 130 billion RMB, driven by accelerated financing [6][15]. - **Retail Investor Behavior**: Retail investors showed increased market participation, with direct inflows of 113.4 billion RMB and a shift to net inflows of 68 billion RMB through public and private funds [7][15]. - **Leverage and Foreign Investment**: Leverage funds saw a significant net inflow of 105.3 billion RMB, marking a new high for the year. Foreign investment also increased, with northbound trading accounting for 14% of total trading volume, indicating a growing interest in the Chinese stock market [8][9][10]. Additional Important Insights - **Fundraising and New Issuance**: Public funds raised over 20 billion RMB in new shares, with passive products dominating the market. The flexible allocation funds reached a record high of over 70% in equity positions [11][15]. - **ETF Performance**: The performance of various ETFs showed divergence, with broad-based ETFs experiencing outflows while industry-specific ETFs saw significant inflows, particularly in TMT and cyclical sectors [12][15]. - **Market Indicators**: The "stock-exchange hedging" indicator reached a warning zone, suggesting potential market corrections, while the AH hedging index indicated that A-shares were outperforming H-shares but had not yet entered a warning zone [13]. This summary encapsulates the key points discussed in the conference call, highlighting the current state of the A-share ETF market, investor behavior, and macroeconomic influences.