Moutai shares surge after it hikes price of flagship liquor

Shares of Kweichow Moutai rose the most in about two months after China’s top liquor maker announced a price increase for its flagship Feitian Moutai spirit, in a move that could bolster its earnings prospects. The stock was up as much as 4.2% in Hong Kong trading, the biggest intraday gain since January 29. The baijiu maker will raise Feitian’s ex-factory price — charged to distributors and wholesalers — by 100 RMB ($14.5) to 1,269 RMB per bottle starting Tuesday, according to an exchange filing. The suggested retail price will jump by 40 RMB to 1,539 RMB per bottle. Moutai last raised Feitian’s ex-factory price in late 2023, and the suggested retail sticker in 2018. How China’s anti-graft crackdown pressured Moutai sales The move is expected to support Moutai’s earnings growth as sales of its high-proof liquor have been pressured amid weak demand — and Beijing’s crackdown on boozy banquets among government officials and businessmen. It also reflects Moutai’s push to revamp its pricing framework while expanding direct-to-consumer sales channels. Sales are now projected to grow 0.8% this year, compared with a previous forecast for a 1% decline, Goldman Sachs Group analysts including Leaf Liu said in a note. Growth could accelerate to 7% by 2027, they said. Morgan Stanley analysts said Feitian wholesale prices are likely to rebound in the near term following the increase, though supply and demand dynamics will remain the key determinant.

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Moutai shares surge after it hikes price of flagship liquor