China Galaxy Securities: Moutai and Wuliangye Yibin's wholesale prices have increased, signaling improvement in the liquor sector.

China Galaxy Securities released a research report stating that, overall, the recent price adjustment of Moutai is expected to drive a short-term price increase in the liquor industry. The recent price rebound of Feitian Moutai and Wuliangye Yibin has also been initially validated, which may lead to a recovery in the liquor sector. Continuous observation of the sales situation during the upcoming Mid-Autumn Festival and National Day peak seasons is required. At the level of listed companies, it is suggested to focus on Kweichow Moutai (600519.SH), which is leading in restoring its pricing system and continuously promoting transformation towards the consumer end to gain market share; other high-end brands are expected to follow Moutai's price increase and achieve slight price recovery; for regional liquor, attention should be given to companies with strong inherent advantages. The main points from China Galaxy Securities are as follows: Moutais offline self-operated stores have raised prices on some products again. According to a report from Jiu Shuo, on August 8, some retail prices of products in Moutai's offline self-operated stores rose again, with Feitian Moutai standard product increasing to 1,753 yuan (+2%), premium Moutai rising to 2,410 yuan (+2%), classic Maotai rising to 1,951 yuan, and Five-Star Moutai increasing to 1,743 yuan. Earlier, the company had already raised the factory price and self-operated retail prices of Feitian Moutai standard products twice this year, in March and July respectively. This price increase aims to set a benchmark for offline retail prices. For instance, the price system for Feitian Moutai standard products includes three categories: offline self-operated stores (retail price of 1,753 yuan), the iMoutai app (retail price of 1,639 yuan), and non-direct sale channels (factory price of 1,369 yuan, with wholesale and retail prices fluctuating with the market). The recent price increase in offline self-operated stores is intended to establish a benchmark for offline retail prices across the market in anticipation of the upcoming Mid-Autumn Festival and National Day peak seasons, and it also signifies Moutais further control over retail prices at the terminal level, with a dynamic adjustment mechanism for self-operated stores now officially in operation to anchor the true transaction prices. As a result, market wholesale prices are expected to follow suit and rise. According to today's liquor price data, driven by the price increase in Moutai's offline direct sales stores, the market wholesale price of Feitian Moutai rose to 1,730 yuan on August 9, up 5% compared to the pre-price increase on July 18, and approximately 12% higher than at the beginning of the year. According to a report from Jiu Shuo, the wholesale price of Wuliangye Yibins Pu Wuba product has also increased recently. This price increase reflects Moutais ongoing promotion of transformation towards the consumer end. In the past, Moutai's offline self-operated stores primarily supplied group purchase customers. With this adjustment, individual customers can also purchase products, reflecting the company's steady progress in its strategic transformation towards individual consumers. Furthermore, there are certain limits on the daily purchase quantity for individual customers, which can help stabilize the market price system. Initial signs of improvement are emerging; focus on sales during the Mid-Autumn Festival and National Day. The institution believes that after experiencing a continuous adjustment in the fundamentals of the liquor industry in Q2 of 2026, the operational pressure on liquor companies and channels has been partially relieved. Combined with lower baseline numbers for shipments from liquor companies in the second half of 2026, there is hope for a quarter-on-quarter improvement. The recent price recovery of Feitian Moutai and Wuliangye Yibin may serve as critical signals, but the sustainability of this improvement will need further observation of the sales recovery during the Mid-Autumn Festival and National Day peak periods. Risk warning: Risks of demand recovery falling short of expectations, risks of price fluctuations, food safety risks.