Following the price increase of Moutai, Wuliangye announced that it would take the opportunity to increase the ex-factory price of the eighth generation of Wuliangye, which attracted the attention of the industry.
According to the "Paper", on December 18, Wuliangye held the 27th December 18 Conference on Consultation, Co-construction and Sharing. Zeng Congqin, Secretary of the Party Committee and Chairman of Wuliangye Group, said at the conference that in 2024, Wuliangye will make every effort to promote the improvement of channel profits, choose the opportunity to appropriately adjust the ex-factory price of the eighth generation of Wuliangye, appropriately reduce the amount of input, and promote the cultivation of consumers.
According to the surging news, Zeng Congqin emphasized that Wuliangye will enter a strategic upward cycle, and continuously improving profits is the primary problem that Wuliangye must accelerate to solve.
On November 1 this year, after Moutai announced the adjustment of the ex-factory price of Feitian and five-star series Kweichow Moutai, the market has attracted much attention about who is the second liquor company to adjust the ex-factory price. As the second oldest liquor, Wuliangye has always been the object of market speculation.
After the news was released, the ** share price of Wuliangye on the 18th was 134 yuan, and as of the 25th**, the share price of Wuliangye was 13455 yuan, the increase is not large, even higher than 347The stock price of 81 yuan has a high of 61%**, why Wuliangye announced an opportunistic price increase at this time, and we have to look for clues from the financial report.
According to China.com, not long ago, Kweichow Moutai (hereinafter referred to as Moutai) announced a 53% vol increase in the ex-factory ** of Kweichow Moutai from November 1, 2023, with an average increase of about 20%. Based on its increase, the ex-factory price of 500ml 53%vol Feitian Moutai has been raised from the previous 969 yuan bottle to about 1,163 yuan bottle, and the price of each bottle will increase by about 167 yuan.
Moutai said that the ex-factory price adjustment does not involve market guidance, which means that the market guidance price of Feitian Moutai remains unchanged at 1499 yuan, but Feitian Moutai has been difficult to sell at the guide price in the market due to its scarcity.
After Kweichow Moutai officially announced the ex-factory price, Founder calculated the profit increase brought by the price increase to Moutai in a research report. According to estimates, it is estimated that the revenue of Moutai before the price increase in 2023 will be about 125.2 billion, assuming that Pufei accounts for about 70% and traditional distribution channels account for about 56% (the proportion of direct sales channels will increase to 44 in the third quarter of 2023.)13%), the estimated ex-factory price increased by 20% from 969 yuan, and this year's revenue will increase by about 6.2 billion yuan, with an increase of about 42%, about 4.1 billion yuan of net profit, about 56%。
Moutai's price increase has attracted many liquor companies to follow suit, and Luzhou Laojiao and Yanghe have followed suit. However, some wine companies have ushered in stock prices after raising prices. Among them, Luzhou Laojiao issued the "Notice on Adjusting the 60 Version of Special Qu**" on November 1, and the settlement price of 52 degrees, 43 degrees and 38 degrees of Luzhou Laojiao 60 Edition Special Qu Five-yard (500ml*6) dealers were 20 yuan bottles, and the price increase was in the range of 4% to 5%. On the same day, the share price of Luzhou Laojiao was 22193 yuan, on December 25, ** fell to 17309 yuan, a decrease of 22%, and the share price of Yanghe in the same period began to raise the price on November 20 on the day of 11720 yuan fell to 107 on December 25**39 yuan, a decrease of 84%。The share price of Wuliangye, which is also rumored to have risen in price, has also fluctuated since December, and the ** stock price was 147 on December 121 yuan, 25 ** stock price of 13455 yuan, a decrease of 86%。
Wuliangye has previously responded to the untrue news of "price increase", and the market generally believes that Wuliangye is likely to increase prices in the case of price increases of leading liquor companies. At this year's dealer conference, Zeng Congqin said that "the eight generations of Wuliangye will choose the opportunity to appropriately adjust the ex-factory price", which gave shareholders a reassurance in advance. It's just that Zeng Congqin did not specify when the price would be raised, and how much the price would be raised.
The Paper pointed out in an article on December 18 that in recent years, the liquor industry has entered a period of adjustment, and the industry as a whole has entered the competition in the stock market. In the fierce competition, many liquors have been upside down. This not only weakens the profitability of the distillery, but also reduces the profit of the distributor. How to deal with the problem of quantity and price has also become one of the problems for wine companies. Price adjustment has become one of the ways for many wineries to increase their profits.
Compared with the "official" price increase of Luzhou Laojiao and Yanghe, Wuliangye did not equal the "default" price increase until the dealer conference. In fact, the price increase of Wuliangye is not frequent, and the last time the ex-factory price was raised was in 2021, when the ex-factory price of the eighth generation of Wuliangye (hereinafter referred to as the eighth generation Puwu) was increased from 889 yuan to 969 yuan, an increase of 80 yuan per bottle**, an increase of 9%, and then the retail guide price was raised to 1499 yuan.
It is worth emphasizing that the price increase in 2021 did not bring significant revenue growth to Wuliangye, and the gross profit margin increased slightly. According to the 2021 financial report, Wuliangye's gross profit margin increased from 75 in 202135% to 7542%, an increase of only 007 percentage points. In terms of net profit margin, it increased from 37 in 202102% to 378%, an increase of less than 1 percentage point. In 2022, Wuliangye's total revenue was 739700 million yuan, compared with 662 in 2021100 million yuan, an increase of 1172%, compared to 14% revenue growth in the previous two years37% and 1551%，11.The 72% revenue increase has been the lowest since 2017, and the revenue growth from 2017 to 2019 was respectively. 61% and 2520%, the revenue growth rate in the past three years has been less than 20%, and the revenue growth has slowed down significantly.
According to the financial reports for many years, in terms of net profit, Wuliangye's performance is also declining, and the net profit attributable to the parent company in 2022 will be 266600 million yuan, a year-on-year increase of 1417%, compared to a net profit increase of 17 in 202115%, an increase of nearly 3 percentage points. Previously, from 2017 to 2019, the net profit growth rate was as follows: 36% and 3002%, an increase of more than 30% for three consecutive years, and the highest increase in the past three years is 1715%, and the other two years were all about 14%, which is not even half of the lowest growth years from 2017 to mid-2019.
The performance of Wuliangye's overall gross profit margin is also ineffective in the series of products with specific price adjustments. According to Wuliangye's financial report, the gross profit margin of the series in the first half of 2023 will be 8680%, an increase of only 121 percentage points. The performance of the main competitors in the same period was significantly stronger than that of Wuliangye. Yanghe's gross profit margin in the first half of 2021 was 7443%, and the gross profit margin increased to 76 in the first half of 202312%, an increase of 169 percentage points. Luzhou Laojiao's gross profit margin in the first half of 2021 was 8567%, and the gross profit margin will increase to 88 in 202335%, an increase of 268 percentage points. Moutai thought that its gross profit margin had been high, above 90% for a long time, and the increase was not large in the same period. The comparison of the gross profit margins of Wuliangye and Moutai may not be objective, and the longitudinal comparison of Luzhou Laojiao and Yanghe may be more objective, after the price increase in 2021, Wuliangye has not achieved its goal. In addition to losing the gross profit margin to Luzhou Laojiao, it is even inferior to the gross profit margin of 90 in the drunkard wine internal reference series85%。
Wang Qianqian, general manager of Sicheng Sauce Liquor Company, believes that some wine companies may raise the price of products or lead to rising inventory and upside down, "the influence of large distributors on the head brand increases, and those dealers with huge inventory in their hands must hope to increase the price, and the inventory value in their hands will increase after the price increase, but the benefits obtained by wine companies are not obvious." ”
The open source ** research report also mentioned that the progress of Wuliangye's payment collection is slightly slower than that of the same period in 2022. The slowdown in the progress of payment collection indicates that the market has reacted greatly to the price increase of Wuliangye, and the dealers are not optimistic enough to destock, and most of the leading liquor companies have similar problems except for Moutai.
According to the financial report, in 2021, the inventory of Wuliangye products will be 1,938 tons, and after the retail guide price is raised, the inventory of this series of products will increase to 2,961 tons in 2022. By the first half of 2023, the inventory of this series of products has reached 2,062 tons, exceeding the inventory for the whole of 2021. Or the *** caused by the price increase, so Wuliangye is cautious about the price increase.
Wuliangye in "1218 "At the dealer conference, it was announced that the eight generations of Puwu will not increase throughout the year, and the eight generations of Puwu will be the main product of Wuliangye, and in the case of no increase, the unit price of the product will be increased or a more direct way.
Wuliangye has always attached more importance to channels, "21st Century Business Herald" article shows that at the dealer conference, Jiang Wenge, general manager of Wuliangye, introduced a number of measures for channels, one of which is "eight generations of Puwu throughout the year do not increase, the planned amount of traditional dealer channels is moderately reduced." "This is the first time in four years that the annual plan to reduce the number of distributor channels has been clearly proposed since the launch of the eighth generation of Puwu in 2019.
According to the Beijing News, Wuliangye has made it clear in the "14th Five-Year Plan" that the sales of the liquor industry will exceed 100 billion yuan, which requires Wuliangye to maintain a double-digit growth rate every year to achieve the goal. According to the financial report, Wuliangye's total revenue in the first three quarters of this year was 6253.6 billion yuan, a year-on-year increase of 1211%, net profit attributable to the parent company 2283.3 billion yuan, a year-on-year increase of 1424%。Judging from this performance, it is not a problem to complete the goal of 100 billion yuan. Among them, the revenue of Wuliangye in the third quarter was 170300 million yuan, a year-on-year increase of 1699%, net profit attributable to the parent company 579.6 billion yuan, a year-on-year increase of 1857%。As of the third quarter, Wuliangye's overall performance was good.
According to the "surging news", Jiang Wenge introduced at the dealer conference that Wuliangye's dealer channels and terminal layout are also growing this year. Among them, there are 110 new development dealers and 2 new core terminals60,000, with more than 1,700 stores nationwide, and the number of distributors of Wuliangye Aromatic Liquor Company has achieved double-digit growth. The channel advantage is the guarantee that Wuliangye can be expected to achieve the goals of the "14th Five-Year Plan", but its public declaration of non-increment is tantamount to a disguised admission that the unit price of products will increase.
According to a previous report by "Blue Whale Finance", in the case of no increase in the whole year of 2024, if you want to achieve a revenue growth rate of more than 10%, the price increase of Wuliangye single product should not be less than 10%, which may be the basic premise for Wuliangye to complete the "14th Five-Year Plan" plan, and it is also in line with the range of price increases of leading enterprises such as Moutai, Luzhou Laojiao and Yanghe.
The liquor industry may have entered the era of stock.
According to data from the National Bureau of Statistics, in 2022, the liquor output of domestic enterprises above the designated size will be 67120,000 kiloliters, down 5 percent year-on-year6%, after six consecutive years of decline, compared with the peak of 13.58 million kiloliters in 2016, it has fallen by half. But in the first half of 2023, the situation has improved, and according to the China Liquor Circulation Association, in the first half of 2023, the national liquor production will be 1200 million liters, an increase of 86%；The national liquor sales volume is 1100 million liters, an increase of 92%；The national liquor inventory is 1500 million liters, down 34%。This shows that after three years of the epidemic, the liquor industry is still strong, although there is still a certain decline compared with the peak.
According to the data of the Prospective Industry Research Institute, the scale of China's liquor market will exceed 380 billion yuan in 2023, and it is expected to exceed the trillion mark for the first time in 2026. This means that the market size has increased rapidly in the absence of a significant increase in production, mainly due to the increase in unit price. According to China's Ministry of Commerce, in the first half of 2023, the national retail sales of liquor will be 176 billion yuan, a year-on-year increase of 108%；Among them, the retail sales of high-end liquor were 86 billion yuan, a year-on-year increase of 126%。The growth rate of sales is higher than the growth rate of production, which proves that the unit price is increasing.
Young people don't like to drink liquor or the problems that liquor companies need to face and solve, even Moutai has lowered its price and jointly launched sauce coffee with Luckin, and other liquor companies may face the same problem. According to statistics from the Chinese Academy of Social Sciences, in the first half of 2023, the national liquor consumer group will reach 4200 million person-times, a year-on-year increase of 64%；Among them, young consumers between the ages of 25 and 40 account for only 38%. In addition to the change of cultural background, the high level of liquor may be one of the main reasons.
At the same time, the sharp decline in the number of marriages and newborns has also caused a decline in the consumption side of wedding banquets, and Yang Dayu, general manager of Shengchu Consulting, has ** In the next five years, the wedding banquet, full moon banquet and other liquor consumption scenarios will most likely decline by 30%, and the decline will be close to 50% in the next ten years.
The co-branded products of Moutai and Luckin have detonated the attention of consumers, and Moutai has even launched related co-branded products such as Moutai ice cream, which may confirm that the young consumer market is not invincible.
In the first half of 2023, Wuliangye's advertising and promotion expenses will be 261.3 billion yuan, ranking first;The advertising and promotion fee of Gujing Gongjiu is 189.8 billion yuan, a year-on-year increase of 24075%, ranking second;Kweichow Moutai is priced at 15The advertising and promotion expenditure of 7.6 billion yuan ranked third. It is worth noting that Moutai's marketing expenses account for only 2 percent of total revenue57%, while Wuliangye accounted for 927%, the proportion of Gujing Gongjiu is as high as 2695%。
The liquor consumption market has entered the stock era, and liquor companies have found a roadmap to break through, and the price increase has almost become a common result. Jiang Wenge, deputy secretary of the Party committee, vice chairman and general manager of Wuliangye Co., Ltd., said something that may be the best note for wine companies to break through: "First, further consolidate the foundation of production capacity;The second is to further promote efficiency improvement;The third is to further strengthen quality assurance. ”
Author |Dream Shaw
Kunpeng Project