News

Guizhou Moutai’s market value approaches ICBC

Guizhou Maotai shares hit 1338 yuan in intraday trading, with a market value of 1.680793 trillion yuan, which is the largest market value of A-shares and is currently worth 1.7881 trillion yuan.

By the midday close of May 14, Guizhou Moutai closed up 0.15 percent at 1335 yuan, with the latest market value reaching 16745.

Moutai Liquor is a special product of Maotai Town, Renhuai City, Zunyi City of Guizhou Province, and is a national geographical indication product of China. Guizhou Moutai Liquor Co., Ltd. was founded in 1999 (only part of a long history of many Moutai enterprises) and went public on July 31, 2001. According to the 2019 annual report, Guizhou Moutai had an operating income of 85.43 billion yuan in 2019.

Guizhou Moutai shares hit RMB 1,338 in intraday trading, with a market value of 1.680793 trillion yuan, which is the largest market value of A-shares market in China. If the market value of Moutai can surpass ICBC, it also means that Moutai will become the No.1 A-shares company in China.

Chinese shareholders jokingly refer to ICBC as “Universe Bank” to tease ICBC about its huge market value, income, and profit size. Moutai, which may surpass C”Universe Bank” in market value, but its revenues and profits are also staggering.

Moutai is a famous liquor made in China, also the largest liquor company in China. For a long time in history, Moutai was mainly consumed by Chinese officials and celebrities. However, with the large-scale resistance of the Communist Party of China to corruption within the Party organization itself, Maotai successfully transformed into the most favorite liquor in the private consumption market, and achieved a lasting success.

The reasons for Maoutai’s success are so complex that even the most serious business analysis makes it difficult to summarize the full picture. In the usual perception, Moutai is considered to have the following strengths:

  1. Historical brands means good product. Moutai is one of the benchmark products of Chinese liquor culture. In the new era, it has been given the special meaning of “Chinese liquor representative” by the Chinese people. Moreover, Moutai has always attached importance to brand reputation, the quality has been stable, and the brand value is also growing.
  2. The complex dual positioning of consumer goods and luxury goods. Different from the usual consumer goods, Moutai liquor is quite expensive. A 500ml bottle of 53° Moutai Liquor can be sold for more than 3,000 yuan, and with the increase of in-store years, the price of and aging Moutai can reach more than 1 million yuan. This means that collecting Moutai can also make a lot of money. But on the other hand, unlike bags, watches, and luxury cars, Moutai is a liquor that can be consumed, and its demand will continue to expand.
  3. The regular price increase strategy. This makes Moutai dealers as long as hoarding Moutai can make money steadily, but also naturally makes Moutai obtain a huge bargaining advantage. Moreover, because of the rapid growth of Chinese income, Moutai’s strategy will not affect its sales, but will make its brand stronger.
  4. Aggressive aroma and taste. Moutai belongs to “sauce flavor” in Chinese liquor, which taste is very strong, that lighter taste liquor drinker may be difficult to accept; but on the other hand, once users accept the super aroma of Moutai, it is difficult to try lighter liquor again.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: