Another Chinese Distiller Tops 1 Trillion Yuan Valuation

What’s new: Shenzhen-listed distiller Wuliangye Yibin Co. Ltd. became the second liquor producer in China to top 1 trillion yuan ($150 billion) in market cap after a price surge Thursday.

The Sichuan-based company rose 2.53% to close at 259.41 yuan a share Thursday, pushing its market value to 1.007 trillion yuan. It was the first company to surpass that valuation on the Shenzhen exchange. Wuliangye became the second-most valuable liquor company in China after Shanghai-traded Kweichow Moutai Co. Ltd.

What’s the context: Shares of Wuliangye rose more than 110% since March 31 amid generally strong performance of liquor companies in China.

After a sales decline in the first quarter amid the pandemic, major Chinese liquor companies have enjoyed a strong rebound since the second half of the year. The entire industry reported 5.1% sales growth and 8.5% net profit rise for the first three quarters.

Wuliangye posted 14.5% sales growth for the first three quarters to 42.5 billion yuan. Net profit rose nearly 16% to 14.5 billion yuan.

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Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bobsimison@caixin.com).

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