NEWS
CHINA’S ALCOHOL PRODUCERS RECOUPED COVID LOSSES AS NORMALITY RETURNED IN Q3
By Tony Zhu
17-11-2020
Credit: David Mathews
Life in China more or less returned to normality in the summer, fuelling speedy recovery of China’s alcohol producers. Total revenue for large-scale alcohol makers in the first nine months stood at RMB601.20 billion (USD91.8b), only 0.3% less than the same period last year, according to latest government statistics.
Kweichow Moutai, the leading producer of baijiu, reported 7.2% growth in revenue in the third quarter of this year, while top rival Wuliangye saw its sales increased by 17.8% during the period.
Market capitalisation of Wuliangye, which is listed in Shenzhen Stock exchange, topped RMB1 trillion earlier this month and became the second trillion-yuan alcohol producer after Kweichow Moutai, which is now valued at RMB2.18 trillion.
Smaller rivals such as Jiangsu Yanghe, Luzhou Laojiao and Anhui Gujing all saw their revenues grow between 7% and 15% in the third quarter, reversing from declines in the first half.
Overall pretax profit for the producers from January to September has exceeded pre-COVID level to reach RMB127.72b, up 7.1% compared to same period last year.
Performance of China’s major beer makers was also in full recovery mode in the third quarter.
China Resources Beer Holdings, the country's largest brewer by volume, told Nikkei Asia that sales of its Heineken brand grew in the high double digits between July and September.
Both Tsingtao Brewery and Beijing Yanjing Brewery, the second- and third-largest brewers in China, saw their sales increase by 4.8% and 10% respectively year-on-year in the the third quarter, following declines of 5.3% and 13.9% in the first half.
However, sales of the huangjiu category, which is a traditional rice wine, is still to recover. The top huangjiu producer Guyuelongshan Shaoxing Wine suffered a revenue decline of 9% in the third quarter.
Though huangju's third quarter’s decline was a substantial improvement from the 39.3% drop in the first half, the performance is still lagging behind baijiu and beer.
(the writer can be contacted at: info@thewinechronicle.com)
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