Bottles of Moutai. Photo: VCG

The stock price of China's leading liquor brand Kweichow Moutai opened 0.65 points lower on Wednesday after the regulatory authorities called for caution over price hikes of Chinese liquor for the fear of a rise in use of public funds for banquets and gifts ahead of the upcoming holidays.

The Central Commission for Discipline Inspection in a report on Tuesday sent a clear warning to some buying the luxury liquor as gift with public funds and the scalpers who profit from the premium brand.

There is a public concern that the rising price of high-end liquor will fuel the return of illegal practices of buying gifts and paying for banquets using public funds, the report said.

News reports about price hikes of domestic high-end liquor such as Kweichow Moutai and Wuliangye Yibin have continued to surface, while the prices of many liquor products have reached the historical high point.

The stock price of Kweichow Moutai, which has been at a historical high, reached a peak of 1,828 yuan ($269) on September 2. Since then, the stock price has dropped to around 1,650 yuan after consecutive weeks of adjustments, with a cumulative decline of 7.4 percent.

The stock of the other major liquor maker Wuliangye Yibin has also fallen this month by 8.9 percent.

The official retail price for a single bottle of the 53-degree Flying Fairy is 1,499 yuan, but the real price has doubled. 

"In the last two months, the price of Flying Fairy has been rising at a rate of about 50 yuan per week, far exceeding the price increases of Mid-Autumn festival and National Day last year," a media report said, citing a Moutai liquor dealer.

The market price of Flying Fairy has stayed above 2,800 yuan in September, and the retail price has exceeded 3,000 yuan per bottle, with the price in some areas reaching 3,300 yuan per bottle.

The price hikes of the Chinese liquor have gone beyond normal market operation and have been suspected of being linked to bribery. 

From January to July this year, 383 cases were investigated, 444 people were dealt with, and 331 people were punished for violations of Party discipline, according to an official report.

This is not the first time that major liquor brands have come under spotlight for soaring prices.

A media under the People's Daily published an article in July criticizing some scalpers for profiting while corrupt officials take advantage of a liquor brand to stockpile the liquor due to its high value, which also led to a temporary plunge in the brand's stock prices.