Yamato: China Resources Brewery (00291)'s high-end brand continues to expand and maintain a “buy” rating

The Zhitong Finance App learned that Yamato released a research report saying that China Resources Brewery (00291) management emphasized at a recent event that despite the challenges of overall beer consumption in the mainland, its high-end brand Heineken has continued to record a year-on-year increase of about 20% year-on-year sales in recent months, reflecting the continued increase in Heineken's share in the high-end market and maintaining a “buy” rating.

However, the bank believes that the next high-end brand, Xuehua Chunsheng, may still be under pressure, due to the weakening of the brand's attractiveness and high reliance on competitive catering channels, and the channel is not yet stable. According to the bank, the group is rapidly launching a new high-end brand, but channel investment is still needed to expand sales.

In terms of cost, aluminum prices rose 16% and 3% year-on-month respectively in August, while the proportion of canned beer in Runbeer was about 45%, so it faced a certain amount of cost pressure. The bank also mentioned that Budweiser Asia Pacific (01876) has a 12-month rolling cost locking policy, so the investment cost pressure in the second half of the year is relatively small.

The bank believes that before the Lunar New Year holiday in February next year, since all major beer companies face pressure on product costs, it is not ruled out that the industry will raise prices across the board to pass on costs to retail customers.