According to the Zhitong Finance APP, CITIC Securities released a research report stating that the consumption peak during the Spring Festival has landed steadily, with the sales of liquor during the Spring Festival appearing slightly subdued, and liquor companies' market strategies are generally pragmatic; consumer goods have a relatively low base and low inventory, and performance in holiday dining and WeChat small shops is relatively strong, leading to a steady recovery in consumer goods consumption. In 2025, there will be a continued expansion of domestic demand, focusing on boosting consumption to expand effective domestic demand, with a positive outlook on four sectors: liquor, beer, leading companies in the catering chain, and leisure snacks.
<h2>CITIC Securities' main viewpoints are as follows:</h2>
Liquor: Spring Festival sales appear slightly subdued, with Wuliangye controlling inventory prices
The performance of liquor consumption during the Spring Festival generally meets expectations, rebounding from the heat of the 2024 Mid-Autumn Festival and National Day, but the year-on-year outlook is still expected to decline. Affected by the economic cycle and industry cycle, business scenarios remain weak, and gifting scenarios perform poorly; demand for large banquets during the Spring Festival is also relatively flat; however, family gatherings and visiting relatives still perform well.
In terms of pricing, high-end and mid-high-end segments have declined, while mid-low-end remains stable. Wuliangye has adopted measures such as halting sales and adjusting quotas to optimize channel profitability, with the batch price of Wuliangye rising significantly from around 880 yuan to 930 yuan, and the batch prices of Guojiao and Fenjiu have also rebounded. In terms of brand performance, it is expected that the sales of Moutai and Wuliangye will remain stable, with both volume and price of Fenjiu increasing, and local wines like Yingjia and Jinshiyuan benefiting from consumption in the 100 yuan price segment also showing highlights. The Spring Festival has landed steadily, and the annual outlook may gradually improve.
Beer: Beer sales during the Spring Festival are stable, and industry recovery is expected under a low base
Beer sales during the Spring Festival were stable, with replenishment of inventory occurring after the holiday. The monthly sales experienced some fluctuations due to the timing of the Spring Festival, but the industry's fundamentals remain healthy, with inventory levels kept low. Starting from October 2024, cities like Shanghai and Hangzhou have successively launched dining consumption vouchers. With the implementation of fiscal debt policies and gradual rollout of consumption-related policies, industry sales growth is expected to recover in Q4 2024, and beer consumption is likely to restart volume and price recovery in 2025, focusing on the recovery of dining demand in the peak season as policies unfold.
The beer industry is at the end of the capital expenditure cycle, and good collection periods and stable operating cash flow enable beer companies to enhance their dividends. State-owned enterprises like Qingdao Beer are increasingly valuing shareholder returns, with room for improvement in dividend ratios. Chongqing Beer has maintained a high dividend rate of around 100% in recent years, highlighting its dividend attributes. In 2025, strong brands like Heineken, Chongqing, Lebao, and U8 are expected to continue increasing regional penetration and national trends, further helping companies complete their positioning in the 8-10 yuan price range, with industry structural upgrades still underway. The competitive landscape of the beer industry remains robust, and under a package of policies, beer consumption is expected to restart volume and price recovery.
Dairy Products: Channel inventory is healthy, and fresh milk prices are relatively stable
According to the Ministry of Agriculture and Rural Affairs, in the fourth week of January (with the collection date on January 23), the average price of fresh milk in 10 major producing provinces, including Inner Mongolia and Hebei, was 3.12 yuan/kg, a year-on-year decrease of 14.3%, and a slight increase of 0.3% compared to last week, remaining basically stable. Coupled with upstream capacity reduction, this is expected to help stabilize prices further. Meanwhile, regarding this year's Spring Festival, companies like Yili have maintained inventory at a healthy level, with good freshness of product dates
On the other hand, from a cost perspective, the cost of raw milk is expected to remain low in the future. The prices of feed, such as corn, have also decreased, improving breeding costs and reducing cost pressure for dairy companies. In addition, some leading companies hope to stabilize or slightly reduce their fee targets this year, and profitability is expected to improve year-on-year.
Condiments &amp; Frozen Foods: Steady Growth in Consumption During the Spring Festival, Focus on Performance Improvement Targets
During this year's Spring Festival, consumption was relatively strong, with growth trends observed in tourism, retail, catering, and cinema sectors. According to data from the Ministry of Commerce, the sales revenue of key national retail and catering enterprises during the 2025 Spring Festival increased by 4.1% year-on-year. Data from the State Administration of Taxation shows that the average daily sales revenue of consumption-related industries nationwide during the Spring Festival holiday achieved a year-on-year growth of 10.8%. Overall consumption during the Spring Festival showed a &#34;good start,&#34; but considering the siphoning effect of the peak season, the market is also more concerned about post-festival consumption performance.
Looking ahead to 2025, the macroeconomic fundamentals are currently relatively stable, and companies are taking proactive measures to respond to industry changes. For example, food companies are expanding their channels to major clients, such as Sam's Club, Hema, Yum, and Tastin. Some new products from certain companies are worth looking forward to. Therefore, at this point, the food industry is expected to continue to operate steadily in 2025, with some companies showing good beta.
Soft Drinks &amp; Snacks: Active Sales of Snack Gift Boxes and Nuts, Beverages Benefit from Homecoming Gifts + Spring Festival Banquets
During the Spring Festival, snack gift boxes and nuts saw active sales, and snack wholesale stores also introduced gift box products. Membership stores like Sam's Club performed well with gift boxes, and the channels are becoming increasingly diverse. Traditional channel distributors are relatively cautious in stocking up, and current channel inventories are low, with replenishment needs expected after the Spring Festival. Three Squirrels has experienced rapid growth in offline distribution, continuously enriching its product offerings, and has achieved its goals for the New Year festival, with the company expected to show impressive revenue and profit performance. In 2025, snacks will continue to benefit from the growth of wholesale channels and new product promotions.
Beverages benefit from homecoming gifts during the Spring Festival and an increase in catering banquets, with juice and large-pack products performing well. Chengde Lulu and Yangyuan Beverages' products meet the scene-specific demands of the Spring Festival, achieving good growth. Dongpeng Beverages has shown strong momentum, with its high-speed transportation channels and channels like chess rooms performing excellently, and its main product, Dongpeng Special Drink, is selling actively.
Investment Recommendations: In 2025, Domestic Demand Will Continue to Expand, Focusing on Boosting Consumption to Increase Effective Domestic Demand
The liquor sector is expected to benefit from the domestic economic recovery and the activation of resident consumption, with business scenarios and general consumer sentiment rebounding, returning to the consumption upgrade path. Leading liquor companies are expected to accelerate the recovery of profitability. Currently, the overall valuation of the liquor sector remains low, highlighting its long-term investment value.
With the intensification of policy stimulus, the cyclical catering chain is expected to benefit first from improved expectations.
Continuing to be optimistic: 1) The leisure snack and beverage industries maintain high prosperity, with new channels bringing significant incremental opportunities to companies in the industry; 2) In conjunction with the continuously recovering catering channels, it is recommended to focus on condiments, beer, and catering chain targets that have expectations for new product launches or reforms. Additionally, the current market price of molasses has further decreased month-on-month, which greatly helps yeast companies enhance profit elasticity. 3) The turning point of the raw milk cycle is approaching, and gift-giving scenarios are expected to recover, with dairy products continuing to upgrade structurally, combined with high dividends, highlighting cost-effectiveness
Risk Warning:
The recovery in demand may fall short of expectations. In the past two years, economic growth has slowed due to macroeconomic factors, and national income growth has also been affected. The pace of recovery in residents' income growth and the improvement in consumption capacity in the medium to short term may not meet expectations; food safety risks. In recent years, food safety issues have always been a focus of consumer concern. Although industry chain companies have continuously improved production quality control levels, there are still risks related to food quality and safety due to the long industry chain and the involvement of many links and companies; cost fluctuation risks. In recent years, the price fluctuations of upstream commodities in the food and beverage sector have increased. High-end liquor, as a high-margin category, is less affected by raw material price fluctuations. However, lower-end liquor and categories with a higher proportion of costs, such as condiments, may experience relatively significant impacts on profitability due to raw material price fluctuations

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CITIC Construction Investment released a research report indicating that the Spring Festival consumption peak has landed steadily, with varying performances in the liquor and beer markets. The sales of liquor are flat, and the demand in business scenarios is weak. It is expected that in 2025, the focus will be on four sectors: liquor, beer, catering chains, and leisure snacks. The beer industry is warming up from a low base, and future sales are expected to gradually increase, with policy support further driving the recovery of consumption

Zhitong

CHINA RES BEER-R

SANDMARTIN RTS

CHINA RES BEER

Tsingtao Brewery

TSINGTAO BREW

Yanjing Brewery

LOLO

Three Squirrels

BABA-W

King’s Luck

YANGYUAN

EASTROC BEVERAGE

CITIC Construction Investment: The Spring Festival consumption peak lands steadily, and the consumption of mass consumer goods shows a steady recovery