Zhejiang Merchants Securities: Maintains "Buy" rating on Kweichow Moutai, remains confident in Moutai's bottom-line allocation value.

Zhejiang Merchants Securities' research report points out that the adjustment in Guizhou Moutai's channel model and the slight pressure on non-standard products have impacted its performance, yet they remain confident in the bottom allocation value of Moutai. In Q2 2026, the company's revenue, net profit attributable to shareholders, and non-deductible net profit were 37.575 billion, 17.274 billion, and 17.224 billion yuan, respectively, which were below expectations. They continue to have a strong outlook for Moutai, believing that Q2 2026 marks the bottom for Moutai's performance, with a sequential acceleration expected in Q3 and Q4, based on: a low base in H2, which, under the marketing reforms, is expected to see performance acceleration; the withdrawal of Huijin and Zhengjin from the list of top ten shareholders creates a bottom for the stock; a dividend payout ratio of 79% in 2025, with a repurchase of 3 billion yuan completed, leading to a current TTM dividend yield of 4%. It is estimated that from 2026 to 2028, operating revenue will grow year-on-year by 0.60%, 4.88%, and 5.14%, while net profit attributable to shareholders will increase by 0.05%, 5.18%, and 5.51%, resulting in corresponding P/E ratios of 20, 19, and 18x, maintaining a "Buy" rating.