2024-08-06
한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina
Original first release | Jinjiao Finance (ID: F-Jinjiao)
Author: Chong Lei, CFA
Since being exposed by the 315 Gala, Tinghuajiu has been getting stronger and stronger, and is showing signs of making a comeback.
Recently, Tinghua Liquor has once again launched a massive advertising campaign, covering high-end buildings in 32 major core cities, with over 150,000 elevator posters, and also plans to launch advertising plans in a number of high-end airports.
This crazy advertising still has the familiar flavor of Tinghua Liquor. It seems that it not only gained a huge wave of traffic, but also the stock price of its parent company ST Chuntian has soared.
From June 26 to August 1, ST Chuntian's stock price rose from a low of 1.84 yuan to 3.47 yuan.In a little over a month, the increase was close to 90%.
What's more, some people even sayHuajiu is making a comeback, with the intention of replacing MoutaiThey believe that the main reason for Moutai's decline is that the volume of Moutai released is increasing every year, which has caused a huge oversupply against the backdrop of shrinking high-end consumption; however, the annual output of Tinghua wine is only about 10% of Moutai, "it is a truly scarce product."
The advertisements are very loud, but Tinghua Liquor has not yet given a convincing answer to the most basic question of "Who is buying Tinghua Liquor?"
Who knows, those who made a fortune from hyping up Tinghua wine are now celebrating by drinking Maotai.
I've never been afraid of listening to flowers and wine.
The offline advertisements for Tinghua Liquor, which were recently relaunched, are basically the same as last year. They continue to use large amounts of text to promote the selling points of Tinghua Liquor, including its refreshing taste, the craftsmanship of re-brewing old liquor, and its cooperation with three Nobel Prize winners. The biggest difference isThe "sky-high priced liquor" is no longer mentioned proactively, and the words "for export only" are added to the premium packaging priced at 58,600 yuan.
From July 27, Tinghua Liquor's brand advertisements covered high-end buildings in 32 core cities, with over 150,000 elevator posters reaching the whole country at a high density. A person close to Tinghua Liquor also revealed that Tinghua Liquor will soon launch an advertising plan in many high-end airports.
It has only been 4 months since Tinghuajiu was exposed by the 315 Party. In fact, from the moment of the 315 Party’s redemption and exposure, Tinghuajiu has not been convinced.
According to the 315 report, advertisements in Tinghua Hotel touted the wine's effects of boosting immunity, improving sleep, protecting male erectile function, regulating physiological disorders, and anti-aging. The "rejuvenation" cases of users were also mentioned by the store staff.
However, according to the clear provisions of the "Advertising Law of the People's Republic of China", alcohol advertisements are strictly prohibited from containing content that explicitly or implicitly states that drinking can eliminate tension and anxiety, increase physical strength, etc.
As for the so-called high-tech "cooling agent" of Tinghua wine, it is actually common mint extract. Tianyancha App shows that Yibin Tinghua Wine Industry Development Co., Ltd. has a total of 17 valid patents, including "Method for removing mint flavor from mint wine."
On March 16, Tinghua Wine released an emergency statement on Weibo in the early morning, apologizing for "mentioning health functions and customer cases to customers" and stating that itNot using international patent applications for advertisingThe craftsmanship of Tinghua wine is a licensed technology.It does not add mint or mint extract to the wine.In addition, a statement from a patent agency was attached, stating that Tinghua Liquor currently has more than 50 valid patents."CCTV's March 15 report only selected part of the video."
The implicit and implicit words showed that they did not buy into the CCTV report, which was commented by netizens as "the first time I have seen a rumor-refuting 315 gala" and "hard-nosed CCTV". Even a clerk at a Tinghua wine experience store posted on WeChat Moments that "Tinghua is not something that anyone can suppress", and another clerk claimed in a telephone interview that "the advertising effect brought by the gala is greater than that of his own company's advertising".
Even so, after the 315 Gala, major e-commerce platforms quickly removed Tinghua wine-related products from their shelves, its official public account was also suspended, and the Shanghai Stock Exchange and the China Securities Regulatory Commission also sent regulatory work letters. The advertising materials related to Tinghua wine in the terminal building of Beijing Capital Airport were also removed as soon as the wine company was exposed.For the first time in history, Tinghua Liquor tasted the bitter fruit of over-marketing.
On May 10, Qinghai Spring, the listed company to which Tinghua Liquor belongs, issued an announcement stating that its wholly-owned subsidiary Chengdu Tinghua Shengshi Tinghua Shengshi received an "Administrative Penalty Decision" from the Chengdu Wuhou District Market Supervision Bureau.
The "Administrative Penalty Decision" shows that Tinghua Shengshi used scientifically unconfirmed viewpoints and unverified user reviews of Tinghua wine for misleading commercial promotion in the process of selling Tinghua wine, misleading consumers, which violated the relevant provisions of the "Anti-Unfair Competition Law". It was ordered to immediately stop the illegal behavior and decided to impose a fine of 1.8 million yuan on it.
On June 26, Qinghai Spring announced that the Beijing Chaoyang District Market Supervision Bureau, based on the same legal provisions, imposed an administrative penalty on Qinghai Spring's subsidiary Beijing Tinghua Trading Co., Ltd., requiring it to stop relevant illegal activities (making misleading commercial promotions for its products) and fining it 800,000 yuan.
However, with the passage of time and the implementation of relevant fines, Tinghua Liquor, which had taken a breather, has recently started to make a comeback and once again launched an overwhelming advertising offensive.
I heard that a wine distributor even arrogantly said in his circle of friends: "I'm back! Those who can't kill me will make me stronger!"
A lie repeated a thousand times becomes the truth, but to make people believe the story of "Laojun's dream",The way to get wine from a prostitute is to give money to someone so that they can't refuse it.
In 2021, Tinghua Liquor Industry held an online "Traditional Chinese Medicine Theory Guiding the Healthy Development of Liquor" seminar. Chen Shuang, associate professor of the School of Bioengineering at Jiangnan University and a national-level liquor judge, said at the meeting, "The direction of innovation determines the height of the wine. Tinghua Liquor is based on traditional Chinese medicine theory. It is the first combination of traditional Chinese medicine and liquor, which provides a good example for industry innovation."
In July 2022, Tinghua Liquor invited two Nobel Prize winners, Feride Murad and Arieh Warshel, to serve as its chief scientists. The former is the famous "Father of Viagra".
In November 2023, Tinghua Liquor announced that another Nobel Prize winner, Avram Hershko, winner of the 2004 Nobel Prize in Chemistry, had joined Tinghua Liquor's chief scientist research team.
However, the financial cost of burning money on Tinghua wine is also very heavy.
In 2022-2023, the sales expenses of Tinghua Liquor accounted for nearly 80% of its revenue, which were 76.94% and 79.97% respectively.Selling a bottle of wine worth 50,000 yuan, about 40,000 yuan is spent on marketing; In the first quarter of 2024, this proportion was as high as 64%.
Among the health care products sector of Shenwan's third-level industries, even though health care products require high marketing efforts, ST Spring's sales expense ratio is quite exaggerated. For example, the second highest, By-Health, had sales expense ratios of 40%, 41% and 31% respectively during the same period, which is about half of ST Spring's.
Considering that Tinghua Liquor is a liquor after all, if we put ST Chuntian's sales expense ratio in the liquor sector, it will be even more outrageous. In 2022-2023 and the first quarter of 2024, the median sales expense ratio of the liquor sector was 17%, 17%, and 14%, respectively.
The abnormal sales expense ratio eventually dragged down the company's performance.
The performance forecast shows that in the first half of 2024, Qinghai Spring expects to achieve a net profit attributable to shareholders of listed companies of -58 million yuan to -68 million yuan, with losses widening from -51 million yuan in the same period last year.
ST Chuntian explained that according to the company's annual operating plan, it plans to improve the performance of the wine and beverage business segment in 2024, and carried out relevant marketing and market investment work in the first quarter, but failed to achieve the predetermined operating goals. Coupled with the impact of factors such as the industry cycle in the second quarter, the company incurred losses during the reporting period.
In fact,Since 2020, ST Spring has been making losses.
In 2020 and 2021, Qinghai Spring's net profit attributable to shareholders of the parent company was -320 million yuan and -249 million yuan, respectively.In addition to poor product sales, the surge in administrative expenses and sales expenses was the main reason for the drag on profits.
In 2022, Qinghai Spring's net profit attributable to the parent company was -288 million yuan, continuing to lose money. Qinghai Spring explained that the loss was due to the fact that its wine and beverage products were still in the market investment stage, losses in foreign investments, and the provision for impairment of some assets.
By 2023, despite a slight reduction in losses, Qinghai Spring's net loss attributable to the parent company was still as high as 268 million yuan. From 2020 to 2023, Qinghai Spring's cumulative net loss was 1.125 billion yuan in four years. If the first half of 2024 is included,In the past four and a half years, the company has suffered a loss of at least 1.183 billion yuan.
In other words, although Tinghua Liquor's comeback was fierce, the outrageous sales expenses did not bring back the expected performance. These momentums were more like a "false fat" type of high profile.
The timing of Tinghua Liquor's comeback is also very delicate. Maotai, which is also positioned as the king of high-end liquor, is in a precarious crisis. This coincidence inevitably makes people wonder whether Tinghua Liquor's recent high profile is a plan to take advantage of the situation to snipe Maotai and seize the high-end market share.
Since June, the price of Moutai, the leading liquor, has fallen in a panic.
On June 24, the wholesale reference price of a loose bottle of Feitian even fell to 2,100 yuan, and Moutai's stock price also plummeted. In the past two months, Kweichow Moutai's stock price fell from 1,770 yuan in early May to 1,440 yuan on July 1, a drop of 18%.
Some media reported that this is the longest period of price decline for Feitian Moutai in the past three years. In the auction market, the failure rate of old and vintage wines has increased, collectors are in a wait-and-see mood, and some scalpers who profited by selling stockpiled goods to tobacco and alcohol stores have also suffered losses, and some scalpers are withdrawing from the second-hand Moutai recycling market.
Analysts believe that since May, China's e-commerce platforms have been in fierce competition, and various subsidies and price cuts have greatly increased the supply of cheap Moutai in the market, becoming the fuse for the price drop of Moutai.
The deeper reason is still determined by the relationship between market supply and demand. High-end consumption scenarios with strong social attributes are shrinking, while the supply of Moutai is increasing every year, resulting in a huge oversupply.
Moutai's predicament has given Tinghua Liquor, which is also betting on high-end consumption scenarios, room for imagination. Some industry insiders who are optimistic about Tinghua Liquor even believe that:
"Tinghua's annual output of 3,000 tons is about 1/10 of Moutai's. It is a truly scarce product that can only be supplied to a small number of people at the top of the pyramid, who are also the group whose spending power is least affected by the economic downturn. The limited quota supply has increased the scarcity of Tinghua wine, laid a solid foundation for market price support and ex-factory price increases, and consolidated its ultra-high-end position."
However, scarcity still depends on demand. Scarcity can only be reflected when demand is far greater than supply. For Tinghua Liquor, if it wants to successfully snipe Moutai and become a real high-end liquor or even hard currency, the demand side must improve, which means it must truly answer a commonplace question:Who is buying the wine?
In Tinghua Liquor’s reply to the Shanghai Stock Exchange’s inquiry letter on July 10, this question finally had a rough answer.
ST Chuntian has released the list of the top 20 customers of its liquor business. They are located in Shandong, Chongqing, Chengdu, Beijing and other places, among which Shandong, Sichuan and Beijing have 5, 3 and 3 customers respectively.
In 2023, the company's wine business revenue was 82.9476 million yuan, and the 20 customers achieved a total sales amount (excluding tax) of 60.3212 million yuan, with actual payment of 74.3515 million yuan. Zhongxiangguo (Shandong), Suzhou Jinduhua Technology, and Yantai Rongyu Commerce ranked the top three, contributing 16.0746 million yuan, 6.4009 million yuan, and 5.8722 million yuan respectively.
It is worth noting thatAmong the above 20 customers, many were founded at a relatively concentrated time.According to preliminary statistics, nine companies, including Jinan Tinghua, Shanghai Tinghua and Chongqing Tinghua, were registered and established between January and August last year. In that year, the total sales amount (excluding tax) was 25.2695 million yuan, accounting for 41.89% of the company's total sales in the current period.
Among them, there are some old acquaintances. The actual controller of Beijing Qingliangshan Wine Industry is Kang Ruixin, who controls Jicao Chuntian (Beijing).We were once an excellent distributor of Qinghai Spring Cordyceps powder tablets and related productsGuangdong Jicao, which he once actually controlled, acquired 100% of the equity of Shenzhen Jicao Trading held by the company in 2015; in addition, its affiliated company Tianyuan Niangen (Beijing) is the authorized user of the company's Cordyceps sinensis pure powder tablet patent.
There is also Li Rongquan, the actual controller of Yibin Tinghua Trading and Yibin Tinghua Liquor Industry, the OEM of Tinghua Liquor, who once served as a director of Guangdong Jicao Company, the company's Cordyceps sinensis pure powder tablet distributor.Many years ago, Li was responsible for the production of Lianglu wine under Qinghai Spring.The refreshing drinks, patented preparation technologies and some equipment required for the wine are all provided for a fee by the affiliated companies of the listed company's controlling shareholder.
From February 2018 to December 2023, ST Chuntian paid a total of approximately RMB 396 million to Yibin Tinghua Trading for the implementation of the procurement and wine hoarding plan. As of the end of 2023, the balance of the prepayment was approximately RMB 173 million.
It is clear what ST Chuntian is thinking. Relying on the income contributed by concentrated customers or "old acquaintances", it is impossible to make Tinghua wine a scarce product that can compete with Moutai. This way of cutting leeks is too straightforward and too low-level.
Trying to drag Moutai down with it, Tinghuajiu is still deceiving itself.
References:
Shijie.com: "A 70% surge, the "sky-high" Tinghua wine is back"
China News Weekly: "Who is drinking Tinghua wine, which costs 50,000 yuan a bottle?"
Financial News: "Monthly sales of 156 bottles, Tinghua Wine continues to bet on sky-high prices"
Tracking the scene "2024 Baijiu Midfield: Moutai's Faith Collapses, Is the Ultra-High-End Starting to "Listen to Flowers"? "
Collect and organize the latest news information and make it available for free for everyone to read
