茅台：欢乐中国年

APAC Food & Beverages Kweichow Moutai Co Ltd RatingOutperform Price Target 2,000.00 CNY 600519.CH Moutai: It's a happy Chinese New Year Moutai demand is looking increasingly strong as we head into the key Chinese New Year Close Date13 Feb 2026600519.CH Close Price (CNY)1,485.30Price Target (CNY)2,000.00Upside/(Downside)35%52-Week Range1,657.99/1,322.01ASIAX1,774.40FYEDecDiv Yield3.5%Market Cap (CNY) (B)1,860.00EV (CNY) (B)1,828.11 holiday period. Fetien wholesale prices start the week at RMB1,690 (Exhibit 1), up 12% since the start of January when Moutai announced fundamental changes to their route to marketfocused on taking control of the Fetien value chain. This strong Fetien demand picture iscorroborated by the surge in i-Moutai App weekly average users from c. 2m to 10-12msince Fetien was released on the platform (Exhibit 2). And users are increasingly active, nowopening the App on average 4.5 times per day compared to only 2.1 on average over the last twelve months which indicates that Moutai is releasing significant volumes of Fetien via theApp. We came away from our recent meetings with i-Moutai management with a view that of key skus +16-20% from their trough in Dec 2025 (Exhibit 4), and the Zodiac Snake skujust a shade below the key RMB 2,000 threshold. This improvement is helping to reducethe pressure on distributor working capital which was a key factor driving the liquidation ofFetien inventories throughout 2025. We expect the high-end sku inventory correction tobe completed in H1 2026 and, thereafter, we expect Moutai to return to their DD earnings Moutai valuation is compelling with the stock trading broadly in line with the China Consumer Staples Index on most metrics - NTM P/E: 19.5x, NTM EV/EBITDA: 13.8x, FCF Yield; 4.4%,Div Yield: 3.5% (Exhibit 5) - despite Moutai’s significantly higher margins, ROIC, sustainablegrowth outlook, brand equity and, now, increasingly high Quality commercial strategy. WerateMoutai Outperformwith aRMB2,000 PT(model: 600519.CH). DETAILS