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Kweichow Moutai
BusinessCompanies

Moutai is first Chinese stock to close above 1,000 yuan as US-China trade war truce sees traders raising a toast with the baijiu

  • Shares of Kweichow Moutai rose 4.9 per cent on Monday to a record 1,031.86 yuan (US$150.6), becoming the first Chinese stock to close above the 1,000 yuan mark
  • The surge values the Guizhou-based distiller at 1.3 trillion yuan, almost double the capitalisation of Diageo Plc

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Workers package bottles of liquor at a workshop of Kweichow Moutai in the city of Renhuai in southwest China's Guizhou Province on October 23, 2018. Photo: Xinhua
Zhang Shidongin Shanghai
Kweichow Moutai, the world’s most valuable liquor distiller, has set several records on China’s stock market.
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Shares of the Guizhou province-based company, which produces the upmarket rice liquor under the Maotai brand, rose 4.9 per cent to a record 1,031.86 yuan (US$150.6) on Monday, becoming the first Chinese stock to cross the 1,000-yun level in Asia's largest capital market.

Traders bought more of the stock – whose namesake baijiu is usually the toast at China’s state banquets – after the presidents of the US and China called a truce to their year-long trade war following talks at the G20 meeting in Osaka over the weekend.

Most of the buying came from China’s domestic investors in the A share market, since investments in the stock via the Connect cross-border investment channel in Hong Kong are closed during the city’s July 1 public holiday.

The bull run in Moutai may have more to go, as at least five Chinese brokerages have predicted that the stock may extend its gains by another 10 per cent to 1,100 yuan, with China International Capital Corporation forecasting a bullish 1,250 yuan per share.

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Investors including Jingxi Investment Management agreed. “This is not the end of the run-up on Moutai’s shares and there’s probably more room for the upside,” said Wang Zheng, chief investment officer at the Shanghai-based money manager. “There are anticipations that Moutai will raise the price of its products and such expectations haven’t been fully priced in.”

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