CITIC Securities: Optimistic about the recovery of the liquor sector and suggests increasing allocations to the liquor industry on dips.

According to the research report of CITIC Securities, the 2026 Spring Festival continued the characteristics of the past 2-3 years: on one hand, consumers' awareness of brands has significantly increased, with sales of famous liquor brands clearly outperforming mid to low-end brands; on the other hand, liquor sales are more concentrated during the Spring Festival peak season, with post-Spring Festival sales expected to gradually stabilize. Looking at the whole year, a strong Spring Festival is the basis for stable post-festival sales in 2026. Considering that the liquor industry has been adjusting for many years and is currently at a long-term cyclical bottom, with low market expectations and low holdings, any marginal improvement is expected to greatly boost investment sentiment in the sector. It is recommended to increase allocations to the liquor industry on dips. CITIC Securities predicts a moderate recovery for the beer industry in 2026, with the overall trend of stable volume and increasing prices. It is suggested to focus on leading companies in the industry with strong execution of structural upgrades, strong control over distribution channels, and the ability to command brand premiums.