Dongxing Securities: Three main lines drive demand improvement and structural upgrading, leading food and beverage companies are expected to usher in valuation repairs

The Zhitong Finance App learned that Dongxing Securities released a research report saying that on July 13, 2026, the State Council officially approved the “15th Five-Year Plan” to expand consumption. This is the first time that China has systematically deployed a strategy to expand consumption in the form of a five-year plan. As far as the food and beverage industry is concerned, this round of policies is not simply to stimulate consumption. Instead, it pushes the industry into a new stage where demand improvement and structural upgrading go hand in hand through the three main lines of increasing residents' income, optimizing the consumption environment, and upgrading the consumption structure. Judging from the current fundamentals of the industry, overall food and beverage consumption is still under some pressure. The China Securities Segment Food and Beverage Industry Thematic Index has retreated by about 67% from its 2021 high, and sector valuations are at a historically low level. In the context of increased consumer promotion policies, leading companies with growth and valuation advantages are expected to face valuation restoration. It is recommended to focus on leading food and beverage companies with high dividends, low debt, and stable operating cash flow, especially the quick-frozen industry, condiment industry, and snack industry, where fundamentals are expected to improve.

Dongxing Securities's main views are as follows:

Total capacity expansion opens the industry's growth ceiling

The “Plan” proposes a target of about 60 trillion yuan in total retail sales of consumer goods by 2030 — the figure is 50.1 trillion yuan by the end of the 14th Five-Year Plan, with an increase of nearly 10 trillion yuan over five years. One of the core goals of the “Plan” this time is “a marked increase in the consumer consumption rate.” During the “14th Five-Year Plan” period, the average contribution rate of final consumption expenditure to economic growth reached 58.8%, an increase of 10 percentage points over the “13th Five-Year Plan” period. Driven by the 60 trillion yuan community's zero target, food and beverage, as a cornerstone category of consumer consumption, is expected to obtain definite incremental opportunities along with the expansion of total consumption, which is a systemic benefit to basic consumer industries such as food and beverage.

Policy focus is shifting from “stimulating consumption” to “increasing consumption rate”

The biggest feature of this “Plan” is that it focuses more on improving residents' consumption capacity, rather than just relying on subsidies or phased incentives. The plan proposes to improve residents' income growth mechanisms, raise wage income, property income and social security levels, and at the same time expand service consumption, optimize the consumption environment, enrich new consumption scenarios, and actively develop digital consumption, green consumption, experiential consumption, and AI consumption. This change means that future consumption growth will come more from an increase in residents' income capacity to drive up the consumption rate rather than short-term policy incentives. Demand in the food and beverage industry has high frequency and immediate demand attributes, and will benefit from the increase in residents' income.

Product consumption has been expanded and upgraded, and the benefits of multi-segment racetracks are clear

The “Plan” clearly proposes “upgrading product consumption” and “steadily increasing consumption of lifestyle products.” Specifically, in the food and beverage sector, the plan lays out the following key directions: (1) Catering and regional brands: The “Plan” requires “improving the quality of catering services, compacting operators' main responsibility for food safety, implementing regional catering brand cultivation projects, and encouraging local areas to build food clusters and specialty snack industry clusters.” Upstream and downstream enterprises in the catering supply chain, compound condiments, prepared dishes, etc. will directly benefit from quality upgrades and branding trends in food and beverage consumption. (2) Health food: The “15th Five-Year Plan” life expectancy target was further raised to 80 years, shifting from treating diseases to focusing on health. There is a lot of planning in the field of healthy consumption, and healthiness has become the most definitive long-term trend in the food and beverage industry. Categories such as functional foods, health foods, and nutritional health drinks are expected to usher in structural growth.

Risk warning: The implementation of the policy falls short of expectations, and local supporting measures are progressing slowly; the pace of macroeconomic recovery is lower than expected, and consumer confidence is recovering slowly; industry competition intensifies, and upward pressure on costs reduces corporate profit margins; short-term fundamentals of some sub-industries (such as liquor and dairy products) are still in the process of refining, and the valuation repair process may be repeated.