Anhui Golden Seed Winery Co Ltd

The liquor sector staged a strong rebound on July 20, with Kweichow Moutai closing up nearly 6% and its share price reclaiming the 1,320 yuan level. Gujing Gongjiu hit the daily limit up, Luzhou Laojiao rose over 6%, Jinhui Liquor and Shanxi Xinghuacun Fenjiu gained over 5%, and Wuliangye, Yingjia Gongjiu, and Jinshiyuan all closed higher across the board. On the news front, Kweichow Moutai recently announced another price increase for its core blockbuster product, Feitian Moutai, and its non-standard product, the kilogram Moutai. Effective July 18, the retail price of Feitian 53% vol 500ml Kweichow Moutai on the iMoutai platform was raised from 1,539 yuan per bottle to 1,639 yuan per bottle, and the sales contract price was raised from 1,269 yuan per bottle to 1,369 yuan per bottle. The retail price of the kilogram Moutai was raised from 3,119 yuan per bottle to 3,269 yuan per bottle. Institutions believe the price hikes will help boost earnings. Huachuang Securities estimates that, after deducting value-added tax, the corresponding increase in reported revenue will be approximately 5.6 billion yuan, contributing an estimated profit of around 3.6 billion yuan. Recent semi-annual earnings forecasts from several liquor companies indicate the industry remains broadly under pressure, with Shede Spirits, Swellfun, Golden Seed Winery, and Huangtai Liquor posting losses or profit declines in the first half. Zheshang Securities believes the fundamentals have clearly bottomed out, and Kaiyuan Securities expects the sector to likely recover in the second half of the year. At the close, Kweichow Moutai traded at 1,327.5 yuan per share, up 5.95%, with a total market capitalization of 1.66 trillion yuan.

First-half earnings previews from liquor companies have been released in a concentrated batch. Sub-premium and regional players such as Tianyoude, Swellfun, Golden Seed Winery, Shede Spirits, Shunxin Agriculture, and Huangtai Liquor broadly reported steep profit declines or outright losses. Tianyoude expects first-half revenue to fall about 14 percent year on year, with net profit attributable to the parent down 76 to 84 percent. Shunxin Agriculture sees attributable net profit dropping 69.34 to 79.18 percent. Swellfun delivered its first loss-making half-year report in recent years, with attributable net profit at negative 6.2221 million yuan, swinging from profit to loss. Golden Seed Winery expects an attributable net loss of 60 to 72 million yuan. Huangtai Liquor projects a loss of 10 to 18 million yuan, widening its year-on-year deficit. Shede Spirits earlier disclosed that attributable net profit fell 60.52 to 69.55 percent. Wuliangye, benefiting from a low base a year earlier, expects attributable net profit to rise 88.80 to 98.97 percent. Xiao Zhuqing, an independent commentator on China's liquor industry, said the sector is in a phase of deep adjustment in the first half, marked by shrinking demand, intense channel competition, and structural optimization, putting revenue and gross margins at sub-premium distillers under pressure.

Golden Seed Spirits disclosed its earnings forecast, expecting a net loss attributable to shareholders of 60 million to 72 million yuan for the first half of 2026, compared with a loss of 72.1968 million yuan in the same period last year. The net loss after deducting non-recurring items is expected to be 64 million to 76 million yuan, compared with a loss of 77.5245 million yuan a year earlier. The company stated that the baijiu industry remains in a deep adjustment period, with weak end-consumer demand, intensified channel competition, and pressure on product sales. The company continues to promote channel destocking and price order standardization, which has led to revenue falling short of expectations. The company is also advancing the optimization of product, channel, and expense structures, focusing on building its Fuyang base, but the revenue shortfall has resulted in operating losses.

Golden Seed Spirits has responded to the Shanghai Stock Exchange's inquiry regarding five consecutive years of losses and gross margins below the industry average. The company's 2025 revenue was 722 million yuan, down 21.96 percent year-on-year, with a net loss of 199 million yuan, mainly due to fierce competition in the Anhui baijiu market and deep industry adjustments. Low-end liquor sales volume accounted for about 85.58 percent, while mid-to-high-end product revenue made up only 33.28 percent. The imbalanced product mix dragged down overall gross margins, while selling and administrative expenses together accounted for 45.29 percent of revenue, far exceeding the industry average. The fourth-quarter 2025 loss of 98.08 million yuan was primarily due to dealer rebates in kind reducing revenue, asset impairment provisions, and the divestiture of the pharmaceutical business. The company stated that losses are continuing to narrow, the asset-liability ratio is only 35.89 percent, and 57,300 tonnes of high-quality base liquor provide long-term support. Going forward, it will focus on its Fuyang base market, optimize the product mix, and strictly control expenses to improve profitability.