On September 20th, CaiLian News reported that Guizhou Moutai, a major shareholder since its listing 23 years ago, announced for the first time that it will repurchase shares.

Tonight, Guizhou Moutai issued an announcement stating that the company plans to repurchase company shares through centralized competitive trading. The repurchase amount is 3 billion yuan to 6 billion yuan, and the source of funds is the company's own funds. The purpose of repurchasing shares is to cancel and reduce the company's registered capital. The repurchase price of shares shall not exceed 1795.78 yuan per share (including), and the repurchase period is within 12 months from the date when the repurchase plan is approved by the shareholders' general meeting.

The announcement shows that based on the current total share capital of the company, 1.256 billion shares, and based on the calculation that the total amount of repurchase funds is not less than 3 billion yuan (including) and not more than 6 billion yuan (including), and the upper limit of the repurchase price is 1795.78 yuan per share, the estimated change in share capital is a decrease of 1.6706 million to 3.3412 million shares. After the repurchase and cancellation, the total share capital of the company is expected to decrease to 1.255 billion shares to 1.253 billion shares.

According to the announcement, as of June 30, 2024, the company's total assets were 279.207 billion yuan, the net assets attributable to shareholders of the listed company were 218.576 billion yuan, and the cash and cash equivalents were 145.267 billion yuan. Assuming that the maximum amount of funds for this repurchase of shares, 6 billion yuan, is fully utilized, the repurchase funds account for approximately 2.1489% of the company's total assets as of June 30, 2024, 2.7450% of the net assets attributable to shareholders of the listed company, and 4.1303% of cash and cash equivalents.

In the announcement, Guizhou Moutai stated that the purpose of this share repurchase is to protect the interests of the company and its investors and enhance investment confidence.

In history, Guizhou Moutai mainly rewarded investors through dividends and is well-known for its generous dividends. According to Wind data, the accumulated amount of dividends distributed by Guizhou Moutai since its listing is 232.6 billion yuan. On August 8, 2024, Guizhou Moutai announced the "2024-2026 Cash Dividend Return Plan", which stipulates that the total cash dividend distributed by the company for the years 2024 to 2026 shall not be less than 75% of the annual net income attributable to the parent company, and in principle, dividends shall be distributed twice a year.

This repurchase is also seen as an important means for Kweichow Moutai to maintain its stock price. The trend of Kweichow Moutai's stock price has been weak this year, showing a significant downward trend since May, with the lowest price reaching 1245.83 yuan/share yesterday, hitting a new low in nearly 4 years. As of today's close, Kweichow Moutai's stock price closed at 1263.92 yuan/share, with a drop of over 25% this year.

In addition to the stock price, Maotai liquor prices are no longer firm. The latest wholesale reference prices disclosed today show that the price of Feitian Moutai bulk wine in 2024 is 2365 yuan/bottle, unchanged from the previous day; the price of Feitian Moutai carton is 2470 yuan/bottle in 2024, down another 20 yuan from the previous day.

In addition, according to reports, several scalpers in Beijing have revealed that they no longer buy the Maotai liquor with the zodiac sign of the Dragon Year, claiming that the bulk price has fallen below the selling price (2499 yuan/bottle), causing concerns among liquor dealers about the future price trend of Moutai.

Liquor industry commentators stated that the changes in Maotai's market price are mainly influenced by market and economic factors. Currently, the repurchase prices of Shede, Guojiao 1573, and Wuliangye are also low, with scalpers even beginning to refuse to accept all liquor factories' cultural and creative products. It is expected that from the "Eleven" holiday to the Chinese New Year, baijiu demand will still remain sluggish, and the specific situation needs further observation.