Company Reports

China Resources Beer had the largest volume share in China’s beer market in 2024 and its Snow brand commands over 20% share, according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficiency due to a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

China Resources Beer's, or CR Beer's, first-half revenue increased 1% year-on-year to CNY 24.24 billion, while gross profit fell 1% to CNY 11.6 billion. Shares fell 5% following the results.

China Resources Beer had the largest volume share in China’s beer market in 2024 and its Snow brand commands over 20% share, according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficiency due to a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

We review our 2026 forecasts ahead of China Resources Beer's, or CR Beer's, interim results in August.

China Resources Beer had the largest volume share in China’s beer market in 2024 and its Snow brand commands over 20% share, according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficiency due to a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

China Resources Beer's revenue and net profit declined by 1.7% and 29% year on year, respectively, in 2025, due to sluggish baijiu sales and a CNY 29 billion goodwill impairment. Despite this, the dividend per share rose 34.3% thanks to steady growth in operating cash flow.

China Resources Beer had the largest volume share in China’s beer market in 2024 and its Snow brand commands over 20% share, according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficiency due to a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

China Resources Beer, or CR Beer, continued to face on-trade channels headwinds across its beer and baijiu segments in the second half of 2025, as consumer sentiment was still sluggish.

China Resources Beer had the largest volume share in China’s beer market in 2024 and its Snow brand commands over 20% share, according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficient management of a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

China Resources Beer reported its first-half results, with revenue and net profit growing by 0.8% and 23% year on year, respectively. Operating profit increased by 13% over the same period.

We review our 2025 revenue and net income projections for China Resources Beer, ahead of the release of its interim results in August. On June 27, the company announced the resignation of Chairman Hou Xiaohai. Zhao Chunwu, the president of CR Beer, now serves as interim chairman.

China Resources Beer had the largest volume share in China’s beer market in 2023 and its Snow brand commands over 20% share, according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficient management of a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

Narrow-moat China Resources Beer’s 2024 earnings trailed our estimates on net income, primarily due to higher sales and marketing expenses as well as lower nonoperating income. Management highlighted positive volume growth in early 2025 despite a high base. We think the company could maintain momentum in the first half as it cycles a lower base from March onward. We reduced our 2025-28 net income forecasts by 5%-9% to account for lower nonoperating income and higher tax rates. Accordingly, we lowered our fair value estimate to HKD 38.50 per share, from HKD 40.50 per share. However, we still see shares as undervalued with an estimated 2025 dividend yield of 3.6%. We are expecting a payout ratio of 60%, in line with management guidance. We think the volume recovery experienced by CR Beer could signal an improvement in consumer sentiment throughout 2025.

After reviewing our 2024 forecasts for narrow-moat China Resources Beer, we reduce our full-year revenue and net income projections by 4% and 2% respectively, to factor in weak consumer demand. We also lower our 2025-28 outlook for the beer and baijiu segments, resulting in 7%-9% cuts in our net profit forecasts. As such, we reduce our fair value estimate to HKD 40.50 per share from HKD 45.00, implying 21 times 2025 price/earnings, 11 times enterprise value/EBITDA, and 2.5% dividend yield. Although CR Beer’s shares are undervalued, our sector top pick is Budweiser APAC, which we think carves out stronger prospects for premiumization in the long term.

China Resources Beer had the largest volume share in China’s beer market in 2023 and its Snow brand commands over 20% share, according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficient management of a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

Narrow-moat China Resources Beer’s interim results trailed our estimates due to soft volume and price growth. We cut our 2024 revenue and net income projections by 3% and 5%, respectively, but our 2025-28 forecasts are largely unchanged. Hence, we retain our fair value estimate at HKD 45 per share, implying 25 times 2024 price/earnings, 14 times enterprise value/EBITDA, and 1.8% dividend yield. Shares are undervalued currently, but our top sector pick is Budweiser APAC—we think the latter is better poised to benefit from the long-term premiumization trend in China’s beer market.

China Resources Beer has the largest volume share in China’s beer market in 2021 and its Snow brand commands over 20% share according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficient management of a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

We expect soft demand in the low-end segment to weigh on narrow-moat China Resources Beer’s sales during the first half. We also slightly reduced our 2024 gross margin estimate by 60 basis points to account for operating deleverage. We keep our sales and marketing expenses ratio forecasts, leading to a 4% cut in our 2024 net income projection to CNY 5.77 billion. However, we leave our long-term forecasts largely unchanged. The subpremium beer portfolio has continued to outperform low-end products despite economic headwinds, suggesting the premiumization trend in the sector remains intact. We retain our fair value estimate of HKD 45 per share, which implies 25 times 2024 P/E, 14 times enterprise value/EBITDA, and a 1.7% dividend yield. We see shares as undervalued as the current share price should have largely reflected concerns over near-term earnings headwinds. That said, our preferred pick for the sector is Budweiser APAC, which is trading at the deepest discount to our fair value estimate. We expect the firm to be the major beneficiary of the premiumization trend in China over the long term.

China Resources Beer has the largest volume share in China’s beer market in 2021 and its Snow brand commands over 20% share according to Euromonitor. This has been enabled by decades of acquisitions of breweries and local brands by CR Beer just as Chinese beer volume was taking off. While rapid expansion has helped attain its leadership position, it also created issues like overcapacity, redundant workforce, and inefficient management of a vast number of local brands. As sales volume in the China beer market peaked in 2013, brewers had to transition their business focus to profit growth. In response, CR Beer has taken steps to reduce headcount, improve utilization, and consolidate production lines in order to achieve higher efficiencies in sales and marketing on a nationwide basis.

Narrow-moat China Resources Beer, or CR Beer, reported full-year 2023 results that exceeded our estimate on net profit but missed on the top line. While beer volume growth was below our projection, price/kiloliter came in better than expected. The subpremium beer portfolio continued to drive improvement in profit/kiloliter for the company. CR Beer’s baijiu segment results also highlighted the focus on lowering channel inventories and maintaining price stability in 2023. Although we reduce our five-year revenue compound annual growth rate by 2 percentage points to 7% to factor in lower beer pricing and baijiu sales, we retain our net income projections as we anticipate better cost savings from the synergies of the beer and baijiu businesses. We like the execution on consolidating Jinsha Winery thus far and view management’s strategies constructively.