During the Dragon Boat Festival holiday season, a peak time for dining and consumption, the stock price of Guizhou Maotai fell instead of rising. On June 11th, the stock price continued to plummet, leading to a general decline in A-share liquor stocks.
On June 11th, most individual stocks in the A-share liquor sector experienced a downturn. At closing, Luzhou Laojiao fell by over 4%, while Gujing Gongjiu, Shanxi Fenjiu, and Wuliangye also dropped by over 2%.
By the end of June 11th, the stock price of Guizhou Maotai plummeted by 3.1%, closing at 1569 yuan per share, with a total market value of 1.97 trillion yuan. The market value evaporated over 63 billion yuan in a single day.
Compared to its peak market value of 2.22 trillion yuan this year, Guizhou Maotai has already lost 250 billion yuan. Compared to the peak of 3.26 trillion yuan in the past five years, the market value has evaporated nearly 1.3 trillion yuan.
With Maotai’s stock price dropping, wholesale prices have also plunged. On June 10th, the Feitian series experienced a sharp decline. Guotou Securities believes that the downward trend in Maotai’s wholesale prices is a significant suppressing factor for the sector. The price drop is due to factors such as weak demand at the high end, Maotai’s delivery structure, and pace.
According to reports from mainland media, there are rumors within the industry that the sudden drop in wholesale prices is related to tens of thousands of scalpers applying for invoicing at liquor stores in a matter of hours. There are rumors in the market that Maotai’s scalpers suffered heavy losses during the 618 (shopping festival) this year, as Maotai’s wholesale prices continue to fall, causing some scalpers who hoarded Maotai to even face losses, with some scalpers running away with the money.
In addition, there are also indications that the decline in Maotai’s stock and wholesale prices coincides with the crackdown on “special supply alcohol” by the Chinese Ministry of Public Security. On June 9th, the official Chinese newspaper “People’s Daily” reported that in the past three months of cracking down on the production and sale of “special supply alcohol” and “special supply alcohol” disguised as party and government agencies, military units, etc., more than 318,000 illegal bottles of “special supply alcohol” were confiscated on the spot.
Maotai liquor was once regarded by the outside world as a symbol of corruption in the Chinese officialdom, becoming the “special supply alcohol” for various military regions, military systems, and government agencies, often used in official gift-giving and bribery. It is reported that the proportion of Maotai liquor supplied to the government and military each year accounts for 60% of its total sales volume.