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the latest announcement from the "stock king" moutai is that it will repurchase its own shares, with the repurchase amount not exceeding 6 billion yuan.

on the evening of september 20, kweichow moutai announced that in order to safeguard the interests of the company and its investors and enhance investment confidence, and on the premise of ensuring that the company's normal operations and long-term development are not affected, the company plans to implement a share repurchase plan with its own funds. the repurchase amount will not be less than 3 billion yuan and not more than 6 billion yuan, and the repurchase price will not exceed 1,795.78 yuan per share. the repurchased shares will be used to cancel and reduce the company's registered capital.

market analysts pointed out that kweichow moutai's repurchase will undoubtedly help boost market confidence, but the long-term rise in stock prices will depend on the company's product strength, channel strength and brand strength.

first repurchase since listing

according to the announcement of kweichow moutai, the total amount of funds for this share repurchase will not be less than 3 billion yuan and not more than 6 billion yuan, and the upper limit of the repurchase price is 1,795.78 yuan per share. it is estimated that the number of shares repurchased this time will be approximately 1.6706 million shares to 3.3412 million shares, accounting for approximately 0.13% to 0.27% of the company's total issued share capital on the date of this announcement.

the company's previously released semi-annual report showed that as of june 30, 2024, the company's total assets were 279.207 billion yuan, the net assets attributable to shareholders of listed companies were 218.576 billion yuan, and cash and cash equivalents were 145.267 billion yuan.

assuming that the upper limit of rmb 6 billion for the repurchase of shares is fully used, the repurchase funds will account for approximately 2.15% of the company's total assets as of june 30, 2024, 2.75% of the net assets attributable to shareholders of listed companies, and 4.13% of cash and cash equivalents.

kweichow moutai stated that after the implementation of this repurchase plan, it will not have a significant impact on the company's daily operations, finance, research and development, profitability, debt repayment ability, future development and maintaining its listing status.

according to the observation of the securities times reporter, this repurchase plan is the first repurchase by kweichow moutai since its listing.

in fact, before kweichow moutai released its repurchase plan, the company's chairman zhang deqin mentioned market value management. in august this year, fang heying, member of the cpc committee and deputy general manager of citic group and secretary and chairman of citic bank, led a team to visit moutai and held a discussion with zhang deqin, secretary and chairman of moutai group, at moutai international hotel. the two sides shared friendship and common development and communicated on further deepening cooperation.

at the symposium, zhang deqin said that citic group, with the mission of "implementing national strategies and promoting national rejuvenation", has given full play to the important role of economic reform pilot and opening-up window, made significant contributions to the country's reform and opening-up and economic construction, and established a good reputation at home and abroad. it is an outstanding representative of the good development of chinese national enterprises and a model for moutai to learn from. moutai was born in the mountains, and its growth is inseparable from the deep care of the party and the country. it embodies the adherence of generations of moutai people to traditional craftsmanship and quality. moutai also unswervingly fulfills its social responsibilities and becomes a faithful inheritor and firm guardian of national and ethnic culture. it is hoped that the two sides will continue to deepen cooperation, and with the advantages of citic, help moutai make new breakthroughs in market value management, industrial and financial integration, and internationalization, better promote the international dissemination of chinese culture, achieve win-win development, and contribute more to local economic and social development.

in addition to repurchasing shares, kweichow moutai also issued an announcement on the increase in holdings by major shareholders. in february 2023, kweichow moutai issued an announcement that moutai group and moutai technology development company increased their holdings of the company's shares for the first time through centralized bidding transactions, with a total increase of 154,500 shares. according to the average transaction price of kweichow moutai on that day, the amount of increase reached 279 million yuan.

at the end of november 2022, while moutai announced a mid-year dividend of 27.2 billion yuan, its controlling shareholder moutai group and its wholly-owned subsidiary moutai technology development company also announced that they would use part of the special dividend funds to increase their holdings of kweichow moutai shares, with the amount not less than 1.547 billion yuan and not more than 3.094 billion yuan.

the company stated that the controlling shareholder's increase in holdings was mainly based on the following aspects: first, confidence in the company's future development prospects and continued steady growth; second, recognition of the company's long-term value; and third, further support for the company's long-term stable and healthy development. at the same time, the main body of the increase in holdings also encourages other shareholders to voluntarily increase their holdings of the company's shares using the funds from the dividend.

several wine companies increased their holdings and repurchased

in recent years, the liquor sector has continued to be sluggish, and many liquor companies have launched repurchase or share purchase plans to "protect the market" with real money and boost industry confidence.

in february this year, shede wine industry issued an announcement stating that it would use its own funds to repurchase 100 million to 200 million yuan of the company's shares within 6 months, and the repurchase price would not exceed 131.00 yuan per share (inclusive).

the announcement shows that the above-mentioned repurchased shares are intended to be used to implement employee stock ownership plans or equity incentives. if the company fails to transfer the repurchased shares within 36 months after the announcement of the share repurchase implementation results and share changes, it will perform the procedures for reducing the registered capital in accordance with the law, and the untransferred shares will be cancelled.

shuijingfang also disclosed that the company's chairman fan xiangfu proposed to repurchase shares for 75 million to 150 million yuan. coincidentally, the shares repurchased by shuijingfang will also be used for employee stock ownership plans or equity incentives.

the increase in holdings and repurchases by kweichow moutai and other liquor companies will inject a "boost" into the market. china merchants securities believes that if the liquor industry can survive the stress test (the price system is smoothly implemented), the sector is expected to see a stock price reversal.

guoyuan securities believes that in the context of rational consumption, consumers focus on product cost-effectiveness, and famous liquor companies with strong brand power and a wide price range product matrix are expected to benefit. liquor companies with strong brand power have a solid consumer base, while famous liquor companies with a wide price range product matrix radiate brand potential downward and are expected to take on the emerging demand for cost-effective consumption.

guotai junan securities said that the recent pressure on the price side of the liquor industry is significantly greater than the pressure on the sales side. product sales are mainly focused on the 100-200 yuan price range and the core flow products in the price range above 200 yuan. the development of the inventory cycle will be reflected in the obvious decline and differentiation of the apparent growth rate of enterprises. in this dimension, "share is brand", and the dominant contradiction in the investment of the liquor sector is the rebalancing of supply and demand and the reconstruction of industry growth expectations. in the next stage, we should continue to pay attention to destocking, wholesale prices and corporate strategies.