Baijiu producer eyes IPO by 2012
By Richard Fu |
May 24, 2011, Tuesday
|
Print Edition
Print Edition
SHAANXI Xifeng Wine Co, maker of one of China's main baijiu brands, aims to list on the stock market by the end of 2012, according to its chairman.
Under an ownership reform ahead of its planned listing the state-owned stake in the company has been reduced to 44 percent, Chairman Yu Deyu said at a baiju forum in Shanghai on Sunday. The company has introduced a number of strategic investors.
Yu, however, didn't say how much money the company aims to raise from the initial share sale.
Some listed baijiu liquor makers have posted strong earnings growth on robust demand and price increases.
Baijiu, or white spirits, is China's fiery sorghum, or rice-based spirit, that is popular among Chinese businessmen who use it to forge ties. Kweichow Moutai Co, China's biggest liquor maker by market value, boosted first-quarter net profit by 49 percent.
The baijiu industry also faces rising competition from wine, especially among young people who perceive drinking wine as more fashionable, and a difficult export market.
The government's crackdown on excess public spending may also affect high-end baijiu sales, said China Merchants Securities analyst Zhu Weihua.
Sinopec last month demoted the general manager of its Guangdong branch after he spent lavishly on alcohol, including Moutai at almost 12,000 yuan (US$1,845) a bottle, which sparked a public uproar.
Industry officials at the forum have called for the establishment of a national industry standard and regulations to protect the highly-fragmented baijiu sector, which also faces problems such as fake products and safety concerns.
Under an ownership reform ahead of its planned listing the state-owned stake in the company has been reduced to 44 percent, Chairman Yu Deyu said at a baiju forum in Shanghai on Sunday. The company has introduced a number of strategic investors.
Yu, however, didn't say how much money the company aims to raise from the initial share sale.
Some listed baijiu liquor makers have posted strong earnings growth on robust demand and price increases.
Baijiu, or white spirits, is China's fiery sorghum, or rice-based spirit, that is popular among Chinese businessmen who use it to forge ties. Kweichow Moutai Co, China's biggest liquor maker by market value, boosted first-quarter net profit by 49 percent.
The baijiu industry also faces rising competition from wine, especially among young people who perceive drinking wine as more fashionable, and a difficult export market.
The government's crackdown on excess public spending may also affect high-end baijiu sales, said China Merchants Securities analyst Zhu Weihua.
Sinopec last month demoted the general manager of its Guangdong branch after he spent lavishly on alcohol, including Moutai at almost 12,000 yuan (US$1,845) a bottle, which sparked a public uproar.
Industry officials at the forum have called for the establishment of a national industry standard and regulations to protect the highly-fragmented baijiu sector, which also faces problems such as fake products and safety concerns.
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