Analysis of Moutai 1935 Price System Adjustment and Investment Value of the Baijiu Industry

Based on collected market data, financial information, industry trends and the latest news reports, I have prepared this in-depth analysis report on the impact of the Moutai 1935 price system adjustment on the investment value of Kweichow Moutai and the baijiu industry.

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According to the latest market information, Moutai 1935, as a core product of Moutai’s Maotai-flavor series, has recently undergone a significant price system adjustment [1][2]:

Adjustment Item	Before Adjustment	After Adjustment	Change Range
Payment Price (Dealers)	RMB 798/bottle	RMB 668/bottle	-16.3%
Retail Guidance Price	RMB 1188/bottle	RMB 738/bottle	-37.9%
Dealer Gross Profit Margin	~10%	~10%	Remained Unchanged

It is worth noting that this adjustment is not an isolated event, but part of the comprehensive price system restructuring of Moutai’s product portfolio [1]:

• 1L Feitian Moutai
  : Reduced from RMB 3,799 to RMB 2,989 (down 21.3%)
• 43% ABV Feitian Moutai
  : Reduced from RMB 1,099 to RMB 829 (down 24.6%)
• Premium Moutai
  : Reduced from RMB 3,299 to RMB 2,299 (down 30.3%)
• 15-Year-Old Moutai
  : Reduced from RMB 5,999 to RMB 4,199 (down 30.0%)
• 100ml Mini Feitian Moutai
  : Reduced from RMB 399 to RMB 299 (down 25.1%)

In October 2025, China Kweichow Moutai Group welcomed its new Chairman Chen Hua, who quickly promoted a comprehensive market-oriented transformation after taking office [1][2]. At the 2026 Kweichow Moutai National Dealer Conference held on December 28, 2025, the following strategic signals were clearly conveyed:

1. Market-Oriented Transformation
   : “Adhere to a consumer-centric approach and comprehensively promote the market-oriented transformation of Moutai’s marketing”, with the core being “follow market trends” and “promote volume-price balance”
2. Channel Reform
   : The distribution model will no longer be used in 2026, which is regarded as “reducing the burden” on dealers
3. Product Structure Adjustment
   :
   • Standard Moutai solidifies the foundation of the product pyramid
   • Premium and zodiac-themed Moutai strengthen mid-tier products
   • Aged and culture-themed top-tier products will be moderately scaled back
4. Series Liquor Strategy
   : No volume increase for Moutai 1935, with expenses tilted toward the consumer end; focus deeply on two national flagship products, Moutai 1935 and Moutai Prince Liquor, and strive to form a “dual 10-billion-yuan” product pattern

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According to the latest financial data, Kweichow Moutai achieved operating revenue of RMB 128.454 billion in the first nine months of 2025, a year-on-year increase of 6.36%; net profit attributable to parent company was RMB 64.627 billion, a year-on-year increase of 6.25% [3]. The composition of main business revenue is: 86.07% from Moutai Liquor, 13.93% from series liquors.

:

• Moutai 1935 belongs to the series liquors category, with 2025 sales exceeding RMB 10 billion, accounting for a large proportion of series liquors revenue
• As the adjustment reduces dealer gross profit margin rather than cutting sales prices, and dealer gross profit margin remains at around 10%, the direct revenue impact on the company is controllable
• The reduction in payment price means the company is actively compressing channel profit margins, but the actual adjustment range of the factory ex-factory price may be limited

The core purpose of the price system adjustment is to

. According to market data [1]:

• On January 3, 2026, the wholesale price of loose-bottle Feitian Moutai dropped to RMB 1,495, and that of original cases was RMB 1,505
• The recycling price of 2026 Feitian Moutai is approximately RMB 1,450

Chairman Chen Hua clearly stated: “Do our utmost to prevent price speculation” and “Dynamically balance product delivery volume based on actual market supply and demand”. This indicates that the company has recognized the problem of high channel inventory and is guiding market expectations through price adjustments.

The company clearly proposed to “abandon the previous inertial thinking of ‘easy wins’” and required dealers to “effectively shift focus to accurately reaching consumer groups, providing high-quality consumer experiences, and deeply cultivating the market to create value” [1]. This transformation means:

• Short-Term Growing Pains
  : Dealers need to adapt to the new profit distribution model
• Long-Term Benefits
  : A healthy channel ecology will improve terminal sales efficiency and reduce the risk of inventory backlog

After the price reduction, the retail price of Moutai 1935 has dropped to RMB 738. The downward shift in the price band will:

• Expand the coverage of target consumer groups
• Enhance product competitiveness (terminal prices had been inverted for a long time previously)
• Increase consumer purchase willingness and frequency

Financial Indicator	Current Value	Industry Position
Gross Profit Margin	>92%	No. 1 in Industry
Expense Ratio	8%	Lowest in Industry
Net Profit Margin	~50%	Highest in Industry
P/E (TTM)	19.82	At Historical Median

From a financial analysis perspective, Kweichow Moutai demonstrates the characteristics of “low risk, high profitability” [4]. Although the price adjustment may have a certain impact on short-term financial statements, considering that:

• The company has the lowest expense ratio in the industry (only 8%)
• An absolute advantage of a gross profit margin exceeding 92%
• Strong brand premium capability

It is expected that mid-to-long-term profitability will remain stable.

As of January 12, 2026, the closing price of Kweichow Moutai was RMB 1,423.23, with the following current valuation characteristics [4]:

Indicator	Value	Assessment
Stock Price	¥1,423.23	In lower-mid range of 52-week interval
52-Week Range	¥1,377.17 - ¥1,657.99	Down ~14.2% from the high
P/E	19.82	At historical median level
EPS	¥71.81	Stable profit growth
Market Capitalization	¥1.78 trillion	Largest market capitalization in A-shares

: The current stock price is in the lower-mid range of the 52-week price interval, with a P/E ratio of 19.82x. Compared with the company’s stable profit growth and industry status, the valuation has a certain safety margin.

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According to industry research data, the baijiu industry entered an in-depth adjustment period in 2025 [5][6]:

:

• In the first three quarters of 2025, the total operating revenue of 20 listed baijiu enterprises in A-shares reached RMB 320.231 billion, a year-on-year decrease of 5.83%
• Total net profit was RMB 122.771 billion, a year-on-year decrease of 6.76%
• The third quarter performance was particularly severe: operating revenue fell 18.42% year-on-year, and net profit fell 22.03% year-on-year

:

• Increased Concentration
  : The top six baijiu enterprises account for 84% of the sales share
• Highly Concentrated Profits
  : The combined net profit of three enterprises, Kweichow Moutai (RMB 85.5 billion), Wuliangye (RMB 35.2 billion), and Luzhou Laojiao (RMB 15 billion), reached RMB 135.7 billion, accounting for 86.1% of the total net profit of all A-share listed baijiu enterprises [5]

The baijiu industry is facing “multiple tests of price systems, market structure, and business confidence” [6]:

• Wholesale prices of premium baijiu have successively “lost” important thresholds
• Some small and medium-sized baijiu enterprises have faced operational crises (such as dealer rights protection for Tanjiu, enforcement actions against Wuyou Liquor, etc.)
• The problem of capacity depreciation has become prominent, and the price of base liquor has continued to decline

In the face of industry adjustments, mainstream baijiu enterprises have generally adopted the following measures [6]:

Strategy Direction	Specific Measures
Price Control	Tighten delivery rhythm and strengthen market order control
Product Innovation	Layout of low-alcohol and cost-effective products
Marketing Transformation	Younger and interactive communication methods
Channel Optimization	Reduce distribution links and increase the proportion of direct sales

This large-scale price adjustment by Kweichow Moutai will have the following impacts on the industry:

:

• After the price reduction, the price band of Moutai 1935 (RMB 738) will form more direct competition with Wuliangye’s core products
• May force competitors to follow up with price system adjustments or increase promotional efforts

:

• Shanxi Fenjiu (Blue and White Series) and Yanghe Co., Ltd. (Dream Blue Series) are facing price band squeeze
• Need to seek breakthroughs in product differentiation and deep channel cultivation

:

• Survival space has further narrowed, and the “Matthew Effect” has intensified
• Enterprises lacking brand characteristics and scale advantages face the risk of exiting the market

• The industry will continue to “bottom out”, and price wars may intensify
• Channel inventory digestion will take time
• Some small and medium-sized baijiu enterprises may accelerate market exit

According to industry observers’ expectations [6], the baijiu industry is expected to usher in a critical turning point of bottoming out and recovering in the second half of 2026. The main driving factors include:

• Macroeconomic recovery drives consumption rebound
• New equilibrium formed after further industry concentration
• Recovery of high-end and mid-to-high-end demand amid consumption upgrading trends

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Advantage Dimension	Specific Performance
Brand Moat	Absolute leader in Maotai-flavor baijiu with extremely strong brand premium capability
Profitability	Gross profit margin >92%, expense ratio only 8%, highest net profit margin in the industry
Financial Health	Low debt risk, abundant free cash flow
Channel Reform	Increased direct sales ratio boosts profits, inventory management optimized

1. Valuation Safety Margin
   : The current P/E ratio of 19.82x is at the historical median, and the stock price is in the lower-mid range of the 52-week interval
2. Performance Stability
   : Maintained “double growth” (operating revenue +6.36%, net profit +6.25%) even during the industry adjustment period
3. Management Transformation
   : The market-oriented transformation promoted by new Chairman Chen Hua is expected to reshape growth momentum
4. Dividend Returns
   : Cumulative cash dividends of RMB 365.555 billion since listing, with cumulative cash dividends of RMB 190.009 billion in the past three years [3]

1. Short-Term Performance Volatility
   : The price adjustment may have a certain impact on Q1 financial statements
2. Industry Systemic Risk
   : The overall adjustment of the baijiu industry may suppress valuations
3. Consumption Recovery Progress
   : Macroeconomic uncertainties may affect demand for high-end baijiu

The baijiu industry is currently in an in-depth adjustment period. It is recommended to pay attention to the following points:

Key Focus Areas	Specific Analysis
Performance Differentiation	Only Kweichow Moutai and Shanxi Fenjiu achieved “double growth” [6]
Valuation Contraction	The baijiu index has fallen 13.76% year-to-date, and sector valuations continue to contract
Increased Concentration	The trend of high-quality assets concentrating on leading enterprises is clear

1. Top Target
   : Kweichow Moutai (600519.SS)
   • Rationale: Absolute industry leader with the strongest risk resistance and a valuation safety margin

2. Secondary Choice
   : Shanxi Fenjiu (600809.SS)
   • Rationale: Mid-to-high-end dark horse with a high profit CAGR of 40.8% and outstanding growth potential [5]

3. Watch for Turning Point
   : Luzhou Laojiao (000568.SZ)
   • Rationale: Achieved a slight year-on-year increase of 0.06% in 2025 against the trend, demonstrating strong resilience [6]

• Regional baijiu enterprises and small baijiu enterprises lacking brand characteristics
• Enterprises with high inventory and significant channel pressure
• Enterprises with continued performance decline and no obvious signs of improvement

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The above chart shows:

1. Top Left
   : Recent stock price trend of Kweichow Moutai (December 2025 to January 2026)
2. Top Right
   : 52-week price range (USD 1,377.17 - USD 1,657.99)
3. Bottom Left
   : Key valuation indicators (P/E 19.82, EPS 71.81, market capitalization USD 1.78 trillion)
4. Bottom Right
   : Comparison of Moutai 1935 price system before and after adjustment

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The price system adjustment of Moutai 1935 is an important part of the company’s comprehensive market-oriented transformation. It may have a certain impact on financial statements in the short term, but in the mid-to-long term:

• ✅
  Positive Factors
  : Optimized channel ecology, eased inventory pressure, improved consumer reach
• ⚠️
  Risk Factors
  : Short-term performance volatility, industry systemic risk

: (Current valuation has a safety margin, fundamentals remain stable)

The baijiu industry is currently in an in-depth adjustment period, characterized by downward price systems and high channel inventory. Moutai’s price reduction may accelerate industry reshuffling, but has limited impact on high-quality leading enterprises.

: , it is recommended to pay attention to opportunities for the industry to bottom out and recover

Target	Recommendation	Rationale
Kweichow Moutai	Accumulate on dips	Industry leader, safe valuation, stable performance
Shanxi Fenjiu	Keep an eye on	Mid-to-high-end growth leader
Wuliangye	Wait and see	Faces price competition pressure
Regional Baijiu Enterprises	Avoid	Narrowing survival space

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[1] Jiemian News - “Moutai Administers a Strong Dose of Medicine” (https://www.jiemian.com/article/13855500.html)
[2] The Paper - “Moutai Administers a Strong Dose of Medicine” (https://m.thepaper.cn/newsDetail_forward_32334998)
[3] Sina Finance - Kweichow Moutai Company Announcements and Financial Report Data (https://finance.sina.com.cn/stock/aiassist/ktgg/2026-01-12)
[4] Jinling AI - Kweichow Moutai Real-Time Market and Financial Analysis Data
[5] Sohu Stocks - “2025 In-Depth Research Series on Listed Baijiu Enterprises: Financial Chapter” (https://q.stock.sohu.com/cn/news.html?textId=964598830)
[6] Securities Times - “Frustrated 2025: Baijiu Industry Explores the Bottom in Deep Waters, Urgently Needs Value Reconstruction” (https://www.stcn.com/article/detail/3550135.html)
[7] Sina Finance - “2025: Baijiu Bids Farewell to the Era of Easy Wins” (https://finance.sina.com.cn/jjxw/2025-12-30/doc-inheqixq4289757.shtml)