In-depth Analysis of Industry Forecast for Luzhou Laojiao: 2026 Critical Turning Point and Transformation Strategy Evaluation

According to the latest data, the cautious forecast of Luzhou Laojiao’s management for the first quarter of 2026 in the baijiu industry

, mainly based on the following:

• From January to October 2025, China’s baijiu production (converted to 65% alcohol by volume, commercial quantity) was 2.902 million kiloliters,
  down 11.5% year-on-year
  , hitting a ten-year low [1]
• The industry has entered
  the eighth consecutive year of production decline
  , with first-quarter 2025 production at only 1.032 million kiloliters, down 7.2% year-on-year [2]
• This marks the complete shift of the baijiu industry from the ‘volume growth’ era to the ‘quality improvement’ era

• In the third quarter of 2025, the baijiu industry’s revenue/net profit attributable to parent companies fell by
  -18.4%/-22.2% year-on-year
  , with the single-quarter revenue decline being the largest since 2012 [3]
• The Spring Festival peak season effect has dropped from 10-12 times in previous years to about
  4 times
  , and mid-to-high-end baijiu faces 30%-40% demand contraction (from management research notes)

Factor	Current Situation	Expected Evolution
Channel Inventory	Still at a high level	Expected to complete healthy adjustment by the end of 2025
Consumer Demand	Weak business and mass consumption	May be verified during the 2026 Spring Festival
Price System	Wholesale prices under pressure, squeezing dealer profits	Expected to recover in the first half of 2026
Policy Impact	Impact of anti-extravagance policies in May 2025	Policy impact gradually digested

The chart shows that Luzhou Laojiao’s stock price experienced volatile decline in 2025, with the current price at 119.39 yuan, down about 7% year-to-date, reflecting market concerns about the industry’s prospects [0]

research report points out: It is expected that the baijiu industry’s financial statements will clear and improve in 2026, and the upward inflection point will gradually become clear. The policy impact on the demand side will continue to weaken, and consumption scenarios will see steady recovery on the basis of significant suppression [1].

believes: The industry has entered the mid-stage of the ‘enterprise suffering period’; in 2026, focus on the recovery of the price index and the sequential improvement of peak season sales; the sector has reached the bottom, and active layout is recommended [3].

• Super high-end baijiu sales will decline by 5% year-on-year in 2025 and resume growth of 1% in 2026
• Mid-to-high-end baijiu sales will decline by 12% year-on-year in 2025 and resume growth of 3% in 2026 [4]

• The cost-effective price band of
  50 yuan to 300 yuan
  has become the main consumer segment (2025 data) [4]
• Mid-to-high-end baijiu (300-800 yuan price band) faces 30%-40% demand contraction (management research notes)
• Consumption share of traditional high-alcohol baijiu (52% ABV and above) has declined

• Traditional consumption scenarios such as banquets and business entertainment have shrunk
• ‘Self-pleasure drinking’ drives demand for low-alcohol and light bottle baijiu
• Light scenarios such as family banquets and friend gatherings have become main consumption scenarios

Dimension	70s/80s Preferences	Z Generation Preferences
Alcohol Content	High-alcohol (52% ABV and above)	Low-alcohol (38% ABV and below)
Drinking Experience	“Getting drunk is尽兴”	“Light intoxication without getting drunk”
Consumption Scenario	Business banquets, formal occasions	Friend gatherings, camping picnics
Purchase Channel	Traditional tobacco and alcohol stores, distributors	Instant retail, live-streaming e-commerce
Brand Perception	Traditional brands, historical heritage	Personalization, experience

• Expected market size of China’s
  low-alcohol baijiu
  to exceed 74 billion yuan in 2025, with a CAGR of 25%, far higher than the overall growth rate of the baijiu industry [1][2]
• Xiaohongshu’s ‘cocktail mixing’ related content has 1.59 billion views and 4.262 million discussions, reflecting young people’s strong demand for personalized drinking [2]

• There is a gap between the traditional baijiu image and young people’s ‘relaxed’ lifestyle
• The older generation’s ‘drinking table culture’ is despised by Generation Z, who resist toasting and drinking competitions
• Young people are more inclined to reclaim the definition of drinking through creative mixing, home DIY cocktails, etc. [2]

• Promote scenario network applications relying on “five-code association” technology
  -打通 information link between
  manufacturer-dealer-end consumer
• Solve long-standing industry problems such as overstocking, low pricing, and cross-region sales
• Promote sales transformation from the “left-side strategy” (pushing through channel layers) to the “right-side strategy” (pulling via consumer scan code) [5]

1. Consumer Digital Intelligence:
   Formulate delivery strategies for market regions, channels, scenarios, and groups, promoting full-link digital scan code applications
2. Channel Digital Intelligence:
   Traditional distribution model is under pressure, shifting to core battlefields such as instant retail and live-streaming e-commerce
3. Organization Digital Intelligence:
   Take scenario codes as the entry point, focusing on eating, living, traveling, and playing to build a consumer experience-centered traffic alliance [5]

• In the first half of 2025, Luzhou Laojiao’s
  emerging channel revenue surged by 27.55% year-on-year
  , with gross profit margin increasing by 4.52 percentage points [6]
• Behind this data is the brand’s deep insight into young consumer logic and forward-looking layout

Product Line	Alcohol Content	Market Performance	Strategic Significance
38% Guojiao 1573	38% ABV	Sales reach 10 billion-level blockbuster product	The industry’s first low-alcohol baijiu blockbuster product
Traditional High-alcohol	52% ABV and above	Demand contraction	Traditional advantage area
Innovative Low-alcohol	Below 30% ABV	In R&D	Cater to Generation Z’s needs

Luzhou Laojiao’s exploration of low-alcohol baijiu dates back to the

, with half a century of technical accumulation. The company has successfully solved three major technical bottlenecks of low-alcohol baijiu: easy turbidity of the wine body, weak taste, and easy hydrolysis during long-term storage [6].

• Steadily promote the building of innovative liquor product circles through brand implantation, event sponsorship, cross-border marketing, etc.
• Innovate the characteristic dinner system, introduce advanced technologies such as
  AI visual holographic effects
  to enrich interactive forms of digital intelligence scenarios
• Create more ‘emotional value’ for consumers rather than just product functions [5]

• Shift from ‘banquets, business entertainment’ to light scenarios such as ‘friend gatherings, camping picnics, home drinking’
• Target Generation Z’s drinking preferences, establish brand connections through interactive methods such as creative mixing and DIY cocktails

1. Deep Technical Accumulation:
   Half a century of R&D on low-alcohol baijiu technology has laid the foundation for 38% Guojiao 1573 to become a 10 billion-level blockbuster product
2. Leading Digitalization:
   The “five-code association” strategy reshapes the consumption path, leading the industry
3. Rapid Growth of Emerging Channels:
   Emerging channel revenue grew by 27.55% in the first half of 2025, verifying the correct strategic direction
4. Brand Power Support:
   Selected into the “First Batch of Chinese Consumer Famous Brands List · Enterprise Brands”, ranked in the Global Top 500 Brand Value in 2025 [5]

1. Transformation Speed vs Industry Adjustment Speed:
   The industry adjustment period may bottom out in the first quarter of 2026, while youth-oriented transformation requires longer time to cultivate the market
2. Balance Between Traditional and Emerging Channels:
   The traditional dealer model is under pressure but still the main revenue source; balancing the two is key
3. Conflict Between High-end Image and Youth-oriented:
   As a high-end brand, Guojiao 1573 needs to coordinate with youth-oriented and low-alcohol strategies
4. Competitors Follow Suit:
   Wuliangye launched 29% low-alcohol baijiu “Chujian”, Gujing Gongjiu launched 26% “Light Gu 20”, competition intensifies [4]

According to the latest financial data [0]:

Indicator	Value	Evaluation
ROE (Return on Equity)	26.10%	Excellent
Net Profit Margin	42.11%	Excellent
Gross Profit Margin	56.50%	Excellent
Current Ratio	3.61	Healthy
Quick Ratio	2.57	Healthy
Debt Risk Rating	Low Risk	Safe

• The 2024-2026 annual dividend plan shows that the dividend ratio will increase year by year in the next three years, not less than 65%, 70%, and 75% respectively
• The absolute amount will not be less than 8.5 billion yuan (including tax) each year, providing stable returns for investors [5]

• ✅ The industry’s production has declined for 8 consecutive years, with a 11.5% year-on-year drop from January to October 2025
• ✅ The industry’s revenue/net profit decline in Q3 2025 is the largest since 2012
• ✅ The Spring Festival peak season effect dropped from 10-12 times to 4 times
• ✅ Mid-to-high-end baijiu demand contracted by 30%-40%
• ✅ Institutions such as CICC and China Merchants Securities all predict an inflection point in 2026

• ❌ Whether the sales volume will substantially recover from the end of 2025 to the 2026 Spring Festival remains to be verified
• ❌ The recovery speed of business and mass consumption demand depends on the macro economy
• ❌ There are regional differences in the progress of channel inventory digestion

• ✅ Emerging channel revenue increased by 27.55%, digital strategy has shown initial results
• ✅ 38% Guojiao 1573 has become a 10 billion-level blockbuster product, with mature low-alcohol technology
• ✅ The low-alcohol baijiu market has a CAGR of 25%, and the track selection is correct
• ✅ Healthy financial status (ROE 26.10%, abundant cash flow) supports transformation

• ⚠️ Youth-oriented transformation requires longer time to cultivate the market, which is difficult to offset the decline in traditional markets in the short term
• ⚠️ There is inherent tension between high-end brand image and youth-oriented strategy
• ⚠️ Industry competition intensifies, Wuliangye, Gujing Gongjiu, etc., have launched low-alcohol products

• 2026 Spring Festival sales data is the key verification point
• Pay attention to channel inventory digestion progress and price system recovery
• Current stock price reflects some pessimistic expectations, technical indicators show oversold (KDJ:14.8,18.4,7.6) [0]

• If the 2026 Spring Festival sales data verifies recovery, you can choose to increase holdings
• Focus on the sustainability of emerging channel growth and the penetration rate of low-alcohol products
• Dividend yield provides a safety margin (2025 dividend ratio not less than 65%)

• The low-alcohol baijiu track has a CAGR of 25%, with broad long-term space
• Leading digital transformation, expected to gain larger market share after industry clearing
• Pay attention to industry concentration improvement under the ‘Matthew Effect’

1. 2026 Spring Festival sales data and channel inventory level
2. Growth rate of 38% Guojiao1573 and low-alcohol product lines
3. Emerging channel revenue share and gross profit margin
4. Industry policies and consumption scenario recovery

1. Demand Recovery Below Expectations:
   If the macro economy continues to be under pressure, the recovery of business and banquet consumption may be delayed
2. Intensified Industry Competition:
   Many liquor companies are increasing investment in low-alcohol and youth-oriented, which may trigger price wars
3. Slow Channel Inventory Clearing:
   If inventory digestion is below expectations, it will suppress price system recovery
4. Brand Image Dilution Risk:
   Excessive youth-oriented may damage the high-end brand image

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[0] Jinling API Data - Luzhou Laojiao Stock Real-time Quotes, Financial Analysis, Technical Analysis, Historical Price Data

[1] China Report Hall - “2025 Baijiu Industry Policy, Environment and Industrial Layout: Dual Challenges of Production Decline and Youth-oriented Transformation” (https://www.chinabgao.com/finance/hs/76584.html)

[2] East Money Wealth - “From Volume Decline to Quality Reconstruction · 2026 Logic of Value Return in China’s Baijiu Industry” (https://caifuhao.eastmoney.com/news/20251208095413737122130)

[3] China Merchants Securities - “2026 Baijiu Industry Investment Strategy: More Active at the Bottom” (https://www.sdyanbao.com/detail/938061)

[4] Securities Daily/East Money - “Year-end Moutai Market Releases Positive Signals; Industry Insiders Say Baijiu Industry May Welcome Inflection Point in 2026” (https://finance.eastmoney.com/a/202512263603227356.html)

[5] Securities Times - “Luzhou Laojiao Chairman Liu Miao: Be Friends with Time to Promote Intelligent and Digital Transformation” (https://stcn.com/article/detail/1556084.html)

[6] East Money Wealth - “Luzhou Laojiao’s Path of ‘Stability’ and ‘Practicality’: Building a Low-alcohol Liquor Matrix to Activate Generation Z Market” (https://caifuhao.eastmoney.com/news/20251225084612997494440)

[7] Sina Finance - “Youth-oriented and Digitalization Efforts Together, Luzhou Laojiao Achieves ‘Steady Progress’ During Adjustment Period” (https://finance.sina.com.cn/jjxw/2025-11-04/doc-infwesht4916413.shtml)

[8] Sina Finance - “In 2026, Liquor Companies Are Still Stuck in ‘Youth-oriented’” (https://finance.sina.com.cn/jjxw/2025-12-16/doc-inhaywri8391372.shtml)

[9] Tencent News - “Goldman Sachs: China Baijiu Industry Q3 2025 Outlook - Stock Price Reflects Emotional Bottom” (https://news.qq.com/rain/a/20250918A01LH200)