Huachuang Securities: Demand for liquor weakens during the New Year's Day holiday, and the closer to the Spring Festival, the more catalytic

The Zhitong Finance App learned that Huachuang Securities released a research report saying that demand for liquor during the New Year's Day holiday was weak. Feedback from many places fell 20% + year on year, but there was a slight improvement over November and December. On the supply side, wine companies' targets have been lowered, and channels are expected to go further to warehouses to relieve pressure. On the demand side, the channel is currently cautious in anticipating demand during the Spring Festival. The overall decline is expected to be double digits, but the decline will be narrower than on New Year's Day. On the price side, for high-end liquor, considering iMaotai's continuous shipment and the imminent arrival of traditional channels, it is expected that Feitian's wholesale price margin will continue to be under pressure. Looking ahead to the whole of 2026, wine companies will move from passive response to active adjustment. The opportunity is that after Maotai prices fall back and stabilize, expectations will bottom out and stabilize.

The main views of Huachuang Securities are as follows:

Demand recovered weakly on New Year's Day, prices continued to be sluggish, but mass consumption was resilient

Demand was weak on New Year's Day, and feedback from many places fell 20% + year over year, but there was a slight improvement compared to November and December. On the one hand, New Year's Day is relatively a month and a half away from spring savings, and the industry is still in low season. On the other hand, consumers travel a lot, and banquet performance is average. In terms of volume and price, industry shipments are expected to drop 10% + during New Year's Day. Demand for business banquets, annual meetings, group purchases, etc. will decrease markedly. The scar effect of feedback from external policies in Jiangsu, Anhui and other places is still there; under pressure on the industry price market, the wholesale price of high-end wine will drop 10% +, and the wholesale price of sub-high-end wine will generally drop 5-10%. Some highlights are that mass consumption is resilient. People from Sichuan, Anhui and other places have reported good performance at banquets and drinks, corresponding to a price range of 80-200 yuan with good turnover.

The three judgments of the Spring Festival: channel removal, narrowing of the decline, and the conflict between supply and demand is expected to ease

Supply side: Liquor companies' targets have been lowered, and channels are expected to go further to warehouses to relieve pressure. Liquor companies have begun to passively slow down. First, with the exception of Maotai and Fenjiu, most wine companies did not meet their initial payment targets in '25, and the growth targets for wine companies in '26 were generally set to maintain a moderate increase; second, requirements for successful repayment tasks during the Spring Festival were reduced, most of which were 30-40% and provided receipt support; third, wine companies stopped shipping when the channel inventory rate exceeded a certain percentage, relieving channel pressure. The channel side is relatively cautious in its intention to repay payments. It places more emphasis on securing cash flow, moderately reducing the scale, and retaining only distribution rights for core brands.

Demand side: The double-digit decline is expected to continue, and the decline is expected to be narrower than on New Year's Day. Currently, the channel is cautious in anticipating demand during the Spring Festival. The overall decline is expected to be double digits, but the decline will be narrower than on New Year's Day. Among them, business demand is still weak. Demand for Spring Festival gifts is relatively rigid, and the decline is expected to narrow. Demand for popular banquets, drinks, etc. is relatively strong, mainly driven by prices, and is expected to drop slightly overall.

Price side: High-end wines go on the market at wholesale prices, exchanging price for volume. Prices are an externalization of supply and demand issues, and it is expected that the Spring Festival price market will still be under pressure. For high-end liquor, considering iMaotai's continuous shipment combined with the upcoming arrival of traditional channels, it is expected that the Feitian wholesale price margin will continue to be under pressure; Wuliangye Puwu's online code scanning campaign is expected to drop slightly, but it will have a certain stimulating effect on sales; Laojiao is expected to increase consumers' spending efforts and reduce alcohol purchase costs during the Spring Festival. For sub-high-end liquors, wholesale prices are currently at a relatively low level, channel profits are getting thinner, and the low level is expected to stabilize during the Spring Festival.

Liquor company dealer conference and channel feedback on recent developments: pragmatically slow down and reduce burdens, focus on basic markets

Maotai: The market-based transformation of Maotai Liquor was comprehensively promoted in 26 years. Maotai Liquor built a pyramid product system and abolished distribution policies to reduce channel pressure; at the same time, Feitian launched iMaotai, digitally empowering channel transformation, effectively stimulating consumer demand for alcohol purchases.

Wuliangye: Combining maintaining market order and strengthening channel incentives to pragmatically increase sales and share. Recently, there has been a slight decline in wholesale prices, but there has been a certain increase in sales, and successful repayment is already underway.

Laojiao: Seize the strategic window for product restructuring, continue to cultivate low-level Guojiao, and strengthen channel promotion efforts. Currently, high-grade Guojiao's wholesale price has remained at 830 yuan, sales have declined in double digits, and the turnover performance of low-level Guojiao is quite good.

Fenjiu: More than 20 blue and white products were given special expenses to strengthen regional breakthroughs. Blue and White Fen promoted nationwide coverage, and Laobaifen focused on key markets to increase bottle opening rates. Currently, the inventory has risen slightly to the level of 2-3 months, but overall channel coordination is good.

Furui: Continue to focus on the main business, strengthen market cultivation, and increase terminal sales. Recently, the company innovated and developed the winery business, and sales performance was outstanding.

Yanghe: Channel pressure continues to be relieved. Classic blue stocks in the province have been reduced to a reasonable level in about 3 months. Prices have rebounded slightly, and dealer confidence has gradually stabilized.

Current world relationship: Adhering to steady progress, mass prices bucked the trend and are expected to continue to contribute to growth, maintain their competitive advantage, and the decline is significantly lower than that of the industry.

Investment advice: The pessimistic factor is already price-in. The closer the Spring Festival gets, the more catalytic it is. I recommend Maotai, and pay attention to Furui

The liquor sector pulled back in December. There were both market concerns about price pricing for high-end liquor companies and the impact of fund position adjustments at the end of the year. Overall, pessimistic expectations were price-in. With leading Maowu prices being adjusted along with price in exchange for volume, demand during the Spring Festival peak season can still be expected, and the mass price band within 200 yuan has clearly benefited from public dinners and drinks. The closer we get to the Spring Festival, the more likely it is to be repaired and catalyzed. Looking at the full year of '26, wine companies have moved from passive response to active adjustments. The opportunity is that after Maotai prices have declined and stabilized, they are expected to stabilize. Next year, the middle of the year will become more clear, and the positions will add up to a more certain level.

From a configuration perspective, we recommend Maotai, which has good certainty and a high dividend rate, and the Spring Festival popular liquor focuses on Gujing Gongjiu (000596.SZ). The recent sharp pullback has financial missteps. Focus on the clear rhythm of Wuliangye (000858.SZ), Shanxi Fenjiu (600809.SH), and Luzhou Laojiao (000568.SZ), in addition to the innovative model variety Zhenjiu Li Du (06979).

Risk Alerts

Demand for liquor fell short of expectations, prices fell beyond expectations, and consumption scenarios continued to be suppressed.