Core Viewpoint - The overall performance of the liquor industry in Q3 2025 is under pressure, with slow payment collection, increased inventory, and weak batch prices due to the impact of the "ban on alcohol" [1][2] Payment Collection - The payment collection progress for liquor companies in Q3 2025 has slowed down significantly, with only Kweichow Moutai expected to maintain a collection rate similar to previous years, while other companies face relative pressure [1][2] Sales Performance - The sales performance in Q3 2025 is under pressure, particularly in June and July due to the "ban on alcohol," although there has been some improvement in August and September. Kweichow Moutai has shown resilience with significant sales growth in August and September, with a year-on-year increase exceeding 20% [2][3] Inventory Levels - After a slight decrease in inventory levels in Q1 2025, the overall inventory in the liquor industry has accumulated due to a significant slowdown in sales since Q2 2025. The inventory is expected to decrease during the Mid-Autumn Festival and National Day, but channel inventory may not see significant reduction [2][3] Batch Prices - Batch prices for most liquor products are under pressure due to the "ban on alcohol" and aggressive promotional activities during the festive season. High-end liquor prices, such as Feitian Moutai, have dropped to 1750-1800 RMB, while other products like Wuliangye have also seen price declines [2][3] Price Segment Analysis - High-end liquor: Kweichow Moutai is expected to maintain growth, while Wuliangye and Luzhou Laojiao may face slight pressure in Q3 2025 - Mid-range liquor: Significant differentiation is expected, with Shanxi Fenjiu showing stable performance, while other brands may benefit from low base effects - Regional leaders: Brands like Gujinggongjiu and Yingjia Gongjiu are still adjusting and may be significantly impacted by the "ban on alcohol" [3][4] Earnings Forecast - Overall, liquor companies are expected to face pressure, with most companies' performance in Q3 2025 projected to decline year-on-year. However, Kweichow Moutai is anticipated to achieve revenue and profit growth, while others like Wuliangye and Shanxi Fenjiu may perform relatively steadily [4] Investment Recommendations - The company suggests focusing on bottom-range allocation opportunities in the liquor sector, recommending leading brands like Kweichow Moutai, Shanxi Fenjiu, and Wuliangye, as well as other brands with growth potential and lower valuations [5]

Core Viewpoint - The Chinese liquor industry is entering a phase of intense competition, with companies experiencing a slowdown in growth and adjusting their strategies for more sustainable development [2][21]. Financial Performance - In 2024, 21 listed liquor companies generated revenue of 443.97 billion yuan, a year-on-year increase of 7.63%, and a net profit of 168.08 billion yuan, up 7.01% [2]. - Only five companies achieved double-digit growth in both revenue and net profit in 2024, down from 15 the previous year [3][4]. - Guizhou Moutai led the industry with a revenue increase of 15.71% to 170.90 billion yuan and a net profit growth of 15.38% to 86.23 billion yuan [4][5]. Market Trends - The industry is experiencing a shift towards "volume competition," where stronger brands are consolidating their market positions while weaker brands struggle [2][21]. - Companies are increasing their marketing expenditures to maintain market share, with 12 out of 21 companies raising their sales expenses in 2024 [10][11]. Sales and Profitability - The highest increase in sales expenses was seen in Wuliangye, which spent 10.69 billion yuan, a 37.15% increase [11]. - Several companies, including Yanghe and Jiugui, reported declines in both revenue and net profit, indicating a challenging market environment [7][18]. Inventory and Contract Liabilities - Inventory levels are rising across most companies, with Water Well's inventory increasing by 31.13% to 3.22 billion yuan, highlighting the ongoing challenge of inventory management [15]. - Contract liabilities showed a mixed trend, with some companies like Gujing Gongjiu seeing a significant increase of 150.86% [14]. Future Outlook - For 2025, companies are setting more flexible growth targets, with many aiming for single-digit growth rates [18][20]. - The market is expected to continue evolving, with a focus on high-quality development and sustainable growth strategies [20][21].