What’s new: Chinese liquor giant Kweichow Moutai Co. Ltd. (600519.SH) is expecting a 19.3% increase in net profit attributable to shareholders this year to around 62.6 billion yuan ($9 billion), higher than 2021’s 12.3% growth, according to a Thursday exchange filing.
The profit growth is above analysts’ average forecast of 18.8%, according to data from iFinD, a market intelligence provider. Moutai said its 2022 revenue would grow 16.2%, higher than last year’s 11.7%.
At the annual marketing meeting held Thursday, Moutai’s Chairman Ding Xiongjun said its new “baijiu”-infused ice cream product is expected to generate 262 million yuan in revenue. The company hopes to expose younger consumers to Moutai liquor though the ice cream, which has about 2% baijiu (白酒) in each tub.
The context: Guizhou province-based Kweichow Moutai is the most valuable Chinese onshore stock with a market capitalization of 2.16 trillion yuan, 47% higher than runner-up Industrial and Commercial Bank of China Ltd.
Moutai’s share price has rebounded 15.3% over the past month after dropping 17.7% for the past year, as investors priced in expectations that consumer spending on liquor would recover as China eased Covid-19 restrictions.
Last month, Moutai announced a 27.5 billion yuan special cash dividend to shareholders. It’s the first time since going public that the company has paid a bonus separate from its regular annual dividend.
Moutai unveiled its baijiu-infused ice cream this year in hopes of attracting more young customers amid analyst concerns that young people are less interested in Chinese liquor.
Related: Kweichow Moutai to Splash $3.8 Billion in First-Ever Special Cash Dividend
Contact reporter Guo Yingzhe (yingzheguo@caixin.com) and editor Bertrand Teo (bertrandteo@caixin.com)
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