January 27, China’s liquor sector continued to plunge, Guizhou Maotai also fell for two consecutive days, the market value shrunk by more than 100 billion yuan.
Choice data show that on Wednesday (Jan. 27), as of the close of trading, most of the liquor sector constituent stocks accumulated declines, led by alcoholic liquor, Yanghe shares, ST Shedd, etc., fell by more than 5%, only Yingjia Gongjiu, Shuijingfang and Gujing Gong B recorded a rise.
Most second- and third-tier wine companies share prices fell more, the largest decline was Huangtai Wine fell more than 34%, Yanghe shares fell more than 12%, while the golden seed wine, Qingqing barley wine, old white dry wine fell more than 10%.
January 27, Guizhou Maotai fell 2.47% to close at 2089 yuan / share, fell below the 2100 yuan mark, the total market value of 2.62 trillion yuan, plus a 1.52% drop on January 26, Guizhou Maotai two days market value evaporated more than 108 billion yuan.
From the capital side, northward capital (foreign capital) continued to sell shares in the liquor sector. Since January 4, 2021, the entire month of January, northbound funds are selling Wuliangye and Guizhou Maotai significantly.
According to Flush iFinD data, as of January 26, foreign investors net sold Wuliangye for 8.828 billion yuan and Guizhou Maotai for 4.024 billion yuan, ranking top among stocks from which northward funds have fled sharply. Wuliangye was net sold for 15 consecutive days out of 17 trading days in January 2021, and Guizhou Maotai was net sold for 14 days.
Currently, it is nearing the Chinese New Year, which is supposed to be the peak season for liquor sales. However, since the outbreak of the Chinese Communist Party virus (Wuhan pneumonia) in 2020, demand for liquor has been greatly reduced, and in 2021, the Communist Party government has called for “local New Year’s Eve” as the virus returns and the Epidemic intensifies across China.
The media expects that many people working outside of China will not be able to return Home this year, and that local people will not be able to interact with each other, give each other gifts or gather because of the embargo, which will hit sales and consumption of liquor.
In addition, there are currently many short-term shortcomings in liquor stocks, and valuations have reached high levels, with even Guizhou Maotai facing an adjustment in its posture. At the end of the year after the results are announced, those who do not match the performance and share price growth of liquor stocks speculation is likely to be unsustainable, the end of the drumbeat day may be just around the corner.
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