Shede Liquor 2025 Annual Report Review

Source: Yiliu Investment Research Notes

Disclaimer: This article is for research and discussion purposes only and does not constitute any investment advice. The stock market carries risks; decisions should be made independently. Build your own logical framework and risk control system. Do not follow the crowd blindly.

Shedde Liquor Industry also released its 2025 annual report yesterday. In recent years, the white liquor industry has faced significant pressure, and the outlook remains uncertain. Although it is an emotional consumption product, many modern social activities serve similar functions—games, short videos, live streaming, etc., all evoke emotions. Society is becoming more micro-focused, and much social interaction now happens online. The romantic notion of “raising a glass to invite the bright moon” is gone; many prefer to stay home and watch videos.

Regarding Shedde’s annual report, I’ll first let the AI platform generate a summary quickly, so I don’t have to read the financial statements manually. Using Python, I parsed the PDF into a text file, then employed Deer-flow and the attached annual report review skill—done in five minutes. Finally, I manually checked the data and adjusted the formatting.

1. Financial Summary: Revenue and profit decline, cash flow slightly improves

In 2025, the company achieved operating revenue of 4.419 billion yuan, down 17.51% year-over-year; net profit attributable to shareholders was 223 million yuan, down 35.51%; basic earnings per share were 0.68 yuan, down 35.34%.

Quarterly-wise, the company remained profitable in the first three quarters, but in the fourth quarter, due to industry adjustments and expense provisions, it recorded a loss of 249 million yuan. During the reporting period, gross margin for the liquor business was 67.67%, down 3.26 percentage points year-over-year, maintaining a reasonable profitability level within the white liquor industry.

Net cash flow from operating activities was -520 million yuan, narrowing by 26.08% compared to the same period last year, indicating some alleviation of cash flow pressure. The company plans to distribute a cash dividend of 3.10 yuan per 10 shares (tax included), with a payout ratio of 45.67%, continuing its stable shareholder return policy.

2. Business Structure: Product mix optimization, mass-market liquor performs well

By product, mid-to-high-end liquor generated revenue of 3.12 billion yuan, down 23.83% YoY, accounting for 74.67% of liquor revenue, still the core profit source; regular liquor revenue was 730 million yuan, up 5.75%, achieving positive growth against the trend. Notable products like Tuo Pai T-68 performed strongly, and the mass-market layout is showing results.

By channel, wholesale agency revenue was 3.249 billion yuan, down 25.19%; e-commerce revenue reached 604 million yuan, up 35.46%, with online channels growing rapidly and channel structure continuously optimized. Regionally, domestic revenue was 1.206 billion yuan, down 20.19%; overseas revenue was 2.647 billion yuan, down 19.25%. The overseas market accounted for 68.69%, and the company’s international expansion is progressing steadily. Additionally, glass bottle business revenue was 470 million yuan, down 3.45%, maintaining stable contribution.

3. Core Competitiveness: Leading aged liquor reserves, brand value steadily rising

In terms of quality, the company is one of Sichuan’s “Six Flowers of Liquor,” with brewing techniques recognized as a national intangible cultural heritage. Since 1976, it has strategically stored high-quality base liquor, with semi-finished and base liquor reserves totaling 182,100 kiloliters, leading nationwide in aged liquor reserves. The ecological brewing industrial park covers 6.5 square kilometers, with a greening rate of 98.5%, highlighting ecological brewing advantages.

Brand-wise, “Shedde” and “Tuo Pai” are both well-known Chinese trademarks. By 2025, the combined brand value exceeds 190 billion yuan, with Shedde valued at 110.87 billion yuan and Tuo Pai at 79.83 billion yuan, forming a strong brand moat. Mechanism-wise, Fosun International continues to empower the company in strategic planning, talent development, and management innovation. The company has established a market-oriented incentive and assessment system, continuously enhancing team combat effectiveness.

4. Brand Building: Cultural IP empowerment, effective brand communication

During the reporting period, the company deepened its brand cultural construction, creating its own IP “Shedde Wisdom Figures,” continuously promoting Shedde’s cultural values. Under the theme “This Era Needs Shedde,” it collaborated with central and provincial media to hold “Era Figures Tribute Gala” and other high-profile events, releasing the brand promotional video “Because It’s Worth It,” which concretizes Shedde’s culture into contemporary spirit, resonating emotionally with audiences. It also innovated with the “Drinking Table Song God” IP, using co-created short videos and new retail channels to connect with young consumers. Focused on C-end dissemination, the company standardized aged liquor groups, transforming scientific research results into communication content, advancing aged liquor strategies, and continuously enhancing brand awareness and reputation.

5. Marketing System: Price stability, inventory control, channel resilience

The company adheres to the core principles of “stabilizing prices, controlling inventory, and boosting sales,” moderating shipment pace to help distributors clear stock, maintaining stable market prices. It focuses on key markets and base markets, increasing consumer cultivation, strengthening member operations, and enhancing core user loyalty. The channel development is diversified: beyond traditional distributors, the company actively expands e-commerce, live streaming, group buying, and direct sales channels. It launched the “Youth Entrepreneurship Program” to cultivate young distributors, building new marketing momentum. International expansion is steady; activities like “Shedde Aged Liquor Festival” and “Shedde Gifts to Global Guests” are ongoing. Products are now available in 42 countries and regions and nearly 100 duty-free stores, with positive progress in global deployment.

6. Capacity Reserve: Expansion projects underway, nationwide leading aged liquor reserves

The headquarters production workshop has a designed capacity of 68,000 kiloliters; in 2025, actual capacity was 31,200 kiloliters, with reasonable utilization. The planned capacity expansion project involves a total investment of 7.054 billion yuan; as of the end of the reporting period, 1.839 billion yuan had been invested, with 32% progress. Once completed, it will significantly enhance base liquor production capacity to meet future market growth. The company’s base liquor reserves are outstanding, with 182,100 kiloliters of semi-finished and base liquor reserves at the end of the period, providing a solid foundation for aged liquor strategy and product quality improvement—an important core competitive advantage.

8. Business Planning: Four strategic synergies, focus on high-quality development

By 2026, the company will implement four strategies: “Aged Liquor, Multi-Brand Matrix, Youthful Branding, and Internationalization,” centered on “Strengthening Foundations, Breaking Through, and Re-Starting,” to promote high-quality growth. The Shedde brand will focus on the aged liquor segment, emphasizing “Aged Liquor Quality + Shedde Culture” to build recognition and scene association; Tuo Pai will focus on emotional and scene breakthroughs, establishing connections with consumers’ lifestyles. Marketing will continue to develop strategic flagship products, promote high-end product structures, and focus on building dominant base markets. The core strategy of “channels downward, brands upward, and full C-end coverage” will be executed through new scenes, new audiences, and new models. In production and R&D, the company will promote integration of liquor and tourism, adhere to technological innovation, upgrade production processes to be smarter and greener, strengthen talent development, and improve internal operational efficiency.

9. Risk Warning: Industry adjustment pressures, competition and management risks coexist

The white liquor industry is currently in a deep adjustment phase, affected by unstable market demand and weak consumer motivation. Industry development faces multiple pressures; if consumption recovery falls short of expectations, company performance growth may be challenged.

The industry has entered a stage of comprehensive competition in branding, quality, channels, and innovation. Excessive competition among leading brands and regional famous liquors intensifies market share battles, increasing the difficulty for the company to expand its market share.

As the company’s scale expands and new businesses like tourism integration develop, higher requirements are placed on management systems, talent reserves, and risk control. If management capabilities do not keep pace, operational efficiency may decline.

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