(Yicai Global) March 29 -- Shares in China's Kweichow Moutai rose to a new high today after the world's largest liquor maker posted a better-than-expected 30 percent annual jump in net profit to CNY35.2 billion (USD5.2 billion) for last year.

The company's stock price [SHA:600519] had expanded 5.77 percent to CNY853.31 (USD126.80) as of 1.30 p.m. Beijing time today after the Guizhou-based firm posted its annual results yesterday.

Moutai registered a 26.5 percent increase in operating income to CNY73.6 billion while its net cash flow from operations swelled 86.8 percent to CNY41.4 billion.

The firm produced 10.1 percent more liquor last year at 70,200 tons, including a 16 percent rise in production of its trademark Moutai baijiu at 49,700 tons.

The company attributed the rise to growing consumption. "The most important thing about growing consumption is the rising quality and service, not product price growth, this is Kweichow Moutai's belief," Chairman Li Baofang told Yicai Global on the sidelines of the Boao Forum for Asia yesterday.

For this year, Li has put added pressure on himself and his company. Moutai aims for 14 percent growth for 2019 though the firm has maintained rapid expansion for three straight years. "I hope that the actual results turn out to be better than planned at the year-end," he said.

Investors pay great attention to Moutai's share price and market capitalization, which has repeated swelled above CNY1 trillion in recent times. The growth in value is also a reflection of rising consumption, he added.

The firm will add annual production capacity to the tune of 6,600 tons by the end of 2019 following the completion of under-construction projects. Moutai does not envisage any further expansions in the long-term due to resource and environment limitations.

The supply of Moutai only meets one-third of demand at present through current production of 56,000 tons. The gap between supply and demand will continue to exist or even get bigger, Li said, adding that the liquor will continue to be scarce.

"The contradiction in the supply and demand of Moutai will continue to intensify, short supply will be a normal state," Li said.

Li also aims to improve performance by boosting the proportion of direct sales of Moutai as part of total sales.

Editor: William Clegg