Alcoholic beverages and tobacco retail sales grew 19.1% year-over-year. Will Moutai's Q1 performance significantly exceed market expectations?

Ask AI · How does Maotai’s market-oriented reform stimulate new consumption demand?

From January to February this year, retail sales data for tobacco and alcohol exceeded market expectations. Specific data shows that from January to February, nationwide retail sales of tobacco and alcohol increased by 19.1% year-on-year, compared to only 5.5% growth in the same period last year. However, considering the Spring Festival factor, the retail sales data from December 2025 to February 2026 still achieved a 10.4% year-on-year increase, also surpassing market expectations.

The 19.1% year-on-year growth in tobacco and alcohol retail sales is partly due to the sales of Maotai exceeding expectations. This can be verified in Maotai’s upcoming first-quarter financial report.

2026 is a key year for Maotai to initiate comprehensive market-oriented reforms. Behind this market reform is also Maotai’s accelerated shift from B2B to B2C development. From a rigorous perspective, Maotai is consolidating its B2B demand while actively expanding its B2C market, allowing more people to taste Maotai liquor.

In 2025, influenced by the “Prohibition 2.0,” the proportion of official government consumption is continuously declining. For Baijiu companies, this necessitates considering development and transformation needs to reduce dependence on official government spending as much as possible.

In fact, after experiencing the impact of the “Prohibition 1.0” over a decade ago, high-end Baijiu like Maotai has seen a significant decline in its share of official government consumption. Before the implementation of “Prohibition 2.0,” the proportion of official consumption for high-end Baijiu was perhaps less than 5%. Even if future official consumption drops to zero, the impact on Baijiu companies will be relatively limited.

Behind Maotai’s full market-oriented reform in 2026 is the push for Maotai liquor to accelerate its return to mass consumption and align more closely with the C-end market. To some extent, the financial attributes of Maotai are gradually weakening, but the emerging mass consumer demand offsets this negative effect. Therefore, for Maotai, leveraging its brand influence can turn disadvantages into advantages. The new round of market-oriented reform may even generate new incremental demand.

However, in the retail sales data for tobacco and alcohol, tobacco’s share is slightly higher than that of alcohol. Although Maotai’s actual share in the alcohol segment is relatively high, its market share in the Baijiu industry may not exceed 30%. Consequently, Maotai’s actual share in tobacco and alcohol retail sales is likely even lower.

The 19.1% year-on-year increase in tobacco and alcohol retail sales reflects a rising enthusiasm for tobacco and alcohol consumption. Excluding the Spring Festival holiday factor, the public’s enthusiasm for tobacco and alcohol is gradually recovering, and consumer confidence is strengthening. However, overall data shows that from January to February this year, retail sales increased by only 2.8% year-on-year, with a slowdown of 1.2 percentage points compared to the same period last year.

Combining the analysis of tobacco and alcohol retail sales with overall retail sales data may indicate that high-end consumption is recovering faster, but mass consumption is still slow to rebound. When tobacco and alcohol retail sales and overall retail sales show synchronized growth, it will be a key signal of consumer confidence recovery.

Maotai’s impressive sales during this Spring Festival, along with steady signs of wholesale price recovery, suggest that Maotai’s first-quarter sales should surpass market expectations. However, whether Maotai’s wholesale prices can remain stable after the Spring Festival will influence its performance in the first quarter and have a significant impact on its annual results.

In other words, if Maotai’s sales momentum continues to improve after the Spring Festival and wholesale prices remain stable, its first-quarter performance is likely to be assured. The stock price, as a barometer of the company’s operational health, has rebounded from its lows, potentially reflecting an optimistic outlook for first-quarter earnings growth ahead of official reports.

Author’s note: Personal opinions only, for reference.