Market Value of China's High-End Liquor Brand Kweichow Moutai Exceeds USD135 Bln
Liao Shumin
/SOURCE : Yicai
Market Value of China's High-End Liquor Brand Kweichow Moutai Exceeds USD135 Bln

(Yicai Global) Nov. 17 -- The share price of Kweichow Moutai Co. [SHA:600519], the Chinese high-end liquor producer, broke CNY700 per share (USD105.6) yesterday, hitting a new record high. As Kweichow Moutai shares rise, some investors are also making big fortunes. However, the investors of northbound trading through the Shanghai-Hong Kong Stock Connect program have started reducing their holdings in Kweichow Moutai.

The value of shares reduced in Kweichow Moutai through the Shanghai-Hong Kong Connect exceeded CNY200 million, showed data released by the Hong Kong Stock Exchange yesterday.

With the sharp rise yesterday, the market value of Kweichow Moutai reached CNY903.3 billion, a step closer to the CNY1 trillion mark. The liquor producer ranked fourth on the A-share market in terms of market capitalization in circulation, second only to the Industrial and Commercial Bank of China Ltd. [SHA:601398; HKG:1398], PetroChina Company Ltd. [SHA:601857] and Agricultural Bank of China Ltd. [SHA:601288].

Kweichow Moutai has always been institutional investors' favorite. In addition to the largest shareholder China Kweichow Moutai Distillery (Group) Co., also known as Kweichow Moutai Group, other institutional shareholders have the biggest gain. Kweichow Moutai's third-quarterly financial report shows that the top 10 shareholders held 75.33 percent of the holdings. The controlling shareholder, Kweichow Moutai Group, held 61.99 percent of the shares, while Kweichow Moutai Distillery Group Technology Development Co. owns 2.21 percent as the third largest shareholder. The remaining are institutional shareholders, including investors via northbound trading in the Shanghai-Hong Kong Stock Connect, and some state-owned institutions like China Securities Finance Co. (CSF).

Among the institutional shareholders of Kweichow Moutai, there are also foreign-funded institutions with 'Qualified Foreign Institutional Investors' (QFII) license. The company's third quarterly report shows four QFII investors among the top 10 shareholders, namely, Oppenheimer Fund, GIC Private Limited, E Fund Management (Hong Kong) Co., and Genesis Asset Managers, LLP.

As Kweichow Moutai share prices steadily climbed recently, institutional investors have started offloading their holdings gradually. Among the top 10 shareholders, four firms reduced holdings in the third quarter of this year, and only HKEx trading through the Shanghai-Kong Kong Connect increased holdings. However, after the third quarter, the stock holdings of Kweichow Moutai held by investors trading through Shanghai-Kong Kong Stock Connect also began to gradually decline.

Wind statistics show that the number of shares held by investors trading through the Shanghai-Kong Kong Stock Connect gradually decreased after their holdings in Kweichow Moutai reached 79 million shares in early October. The investors trading through the Shanghai-Hong Kong Stock Connect held 75.483 million shares of Kweichow Moutai, valued at CNY54.281 billion based on the latest closing price of CNY719.11 per share, showed the latest data. Although the number of shares held by investors trading through the Shanghai-Hong Kong Stock Connect decreased, their floating profit still exceeded CNY15 billion since October.

In addition, the state-owned institutions including the CSF continued to reduce their holdings in Kweichow Moutai during the process of stock prices rise, reducing 631,200 shares and 5,148,800 shares in the second quarter and the third quarter of this year, respectively.

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Keywords: MSCI , Qfii