A bottle of Kweichow Moutai Photo: VCG

 
China’s baijiu producer, Kweichow Moutai, announced on Tuesday that it will raise distributor prices for its best sellers, Moutai Flying Fairy and Five Star, for the first time in six years. This triggered a 6 percent rise in its closing share price in A-share.

The company increased distributor prices for its flagship spirits by 20 percent, reaching 1,169 yuan ($160).

Shares of several baijiu makers rose on Wednesday, including major A-share listed companies such as Yilite, Luzhou Laojiao, and Wuliangye. The rise could be attributed to expectations of growth in liquor consumption amid the current consumer recovery in China.

Kweichow Moutai has the highest market capitalization in the A-share market. Today's share price rise pushed its market value to 2.11 trillion yuan, second only to Tencent among all Chinese-listed companies.

Kweichow Moutai is the world’s most valuable spirits producer.

China's consumption recovery has significantly boosted the growth of the liquor market and helped Kweichow Moutai achieve revenue growth. On October 20, Moutai released its third-quarter report, which showed that the company’s revenue exceeded 100 billion yuan for the first time in the first three quarters.

Moutai realized revenue of 103.3 billion yuan in the first three quarters, up 18.48 percent year-on-year, with its net profit increasing by 19.09 percent. In the third quarter, the company achieved revenue of 33.7 billion yuan, up 14.04 percent, and its net profit recorded a 15.68 percent year-on-year growth, reaching 16.9 billion yuan.

From January to September, China's consumer demand accelerated its recovery. The country’s total retail sales of consumer goods reached 34,210.7 billion yuan, up 6.8 percent year-on-year. The value-added of China’s hospitality and catering industry also grew by 14.4 percent year-on-year.