Citi released a report stating that Tsingtao Brewery (00168.HK) saw a 9% year-on-year drop in third-quarter net profit to 1.3 billion RMB, 10% lower than the bank's expectations, mainly due to higher-than-expected sales expenses and lower-than-expected revenue. Although the gross margin expanded by one percentage point year-on-year, both pre-tax profit and net profit decreased by 9% year-on-year, while sales expenses also increased by 14%.

Citi maintains a "buy" rating for Tsingtao Brewery, with an H-share target price of 84.5 yuan. In the Chinese beer industry, there is a preference for China Resources Beer (00291.HK) and Bud APAC (01876.HK).