Understanding the Market | CHINA RES BEER fell over 3% due to weak demand for alcoholic beverages; institutions expect the company to experience its first year-on-year revenue decline in 2024

CHINA RES BEER fell over 3%, as of the time of writing, it dropped 2.89% to HKD 23.55, with a trading volume of HKD 163 million. Huaxing Securities released a research report stating that CHINA RES BEER is expected to experience its first year-on-year revenue decline since 2020 in 2024, mainly due to weak demand for alcoholic beverages under the impact of the domestic macro economy. By business segment, it is predicted that the company's beer revenue will decline by 1.2% year-on-year in 2024, while liquor revenue is expected to grow by 3.2% year-on-year. Benefiting from the decline in beer raw material costs and continued control of sales and marketing expenses, it is forecasted that CHINA RES BEER's adjusted net profit will grow by 7% year-on-year in 2024. The firm further indicated that as the overall domestic economy gradually stabilizes, and with the expectation of more government subsidy plans to promote consumption, it is anticipated that consumption activities in the ready-to-drink channel will recover in 2025, driving improvements in the product structure of the beer industry. It is predicted that the unit price growth of CHINA RES BEER will accelerate from 2.0% in 2024 to 2.2% in 2025. Additionally, it is expected that the beer sales growth of CHINA RES BEER will turn positive in 2025, rebounding from a year-on-year decline of 3.2% in 2024 to a year-on-year growth of 0.7%, mainly benefiting from the recovery of consumption in the ready-to-drink channel