On Wednesday, shares in China’s leading Baijiu brand Moutai closed at a record high. In the last 12 months, their value has more than doubled, making the liquor giant one of the world’s most valuable consumer-goods companies, according to The Wall Street Journal.
At this point, the company is valued at about $500 billion and expected to bring in $17.6 billion in 2021 revenue. To put this in perspective, Moutai accounts for 7.3 percent of the Shanghai Composite Index, while Apple makes up only 6.7 percent of the S&P 500 in the U.S.
Experts are tying this growth to the company’s namesake Baijiu, which has become a prevalent status symbol. For those unfamiliar, Baijiu is a clear, grain spirit and by far the world’s most consumed liquor by volume.
Wei Wei Chua, a portfolio manager at Mirae Asset Global Investments, explains that “Chinese consumers are drinking less overall but drinking better products. Moutai is the key beneficiary of this premiumization process.”
Although inventories are limited, the company hopes to increase production by 10 percent each year for the next three years. While this may end current supply shortages, some of the spirit’s popularity has been linked to its scarcity. Similar to premium bourbon trends in the U.S., the scarcity of Moutai’s Baijiu has raised the spirit’s price over the years, and lured in this new wave of investors.
As Moutai continues to grow it’s only a matter of time before American consumers catch on. That being said, it’s difficult to track down on any e-commerce platform and typically sells for up to $400 when it is available. One day, these bottles could become the newest wave of spirit clout, and undoubtedly dethrone others like Tesla Tequila.