Dukang

Rogerwilco, thank you! Are you a wine connoisseur by any chance? Otherwise, how did you get to understnd this business so well? (I am just a kopi kia)

Hi Joes! i am just a cheapskate :blush: so no, i am not a wine connoisseur. When i was younger i like to drink beer and tequila. Johnny Walker is quite nice too.

As much as I like the baijiu/craft beer/spirits/soft drinks industry, i am afraid i definitely not an expert and still have to learn more

Will analysts upgrade DK with the 40% increase in capacity in the coming July?

If I may add, the iconic "Jiuzu Dukang" is produced from grain alcohol from fermentation pools with age ranging between 20 and 50 years. An older pool, with more microbial communities and fragrant particles, produces higher grade baijiu.

"Zone 12" in the "Jiuzu Dukang" label shown in page 6 of the annual report suggests that the bottle contains grain alcohol from 40-year-old pool.

It is not clear how the company is going to market products from the newly-constructed pools.
If the company has enough old stock to sustain sales growth for a while, it will be fine.

It will be interesting to see how analysts value DK after thiet 40% increase in capacity is up n running ......!!!!

The following article from Dukang website states that unlike Maotai and Wulaingyi which are not faring well, smallers distillers like Dukang are enjoying good growth:

"自从我国严格控制公款消费以后，白酒行业形势变得不容乐观。高端白酒正在遭遇“寒冬期”，以茅台酒在贵州市场价格为例，一年前53度飞天茅台酒售价约为1900元，如今仅为860元左右。其他高端白酒如五粮液，也正在遭遇茅台的尴尬窘境。

尽管高端白酒遭遇窘境，可并不见得整个行业都进入了寒冬期。

2013年第一季度，以贵州茅台为代表的一线白酒企业营收增幅同比明显下降，而一些地方酒企却显得较为强势。杜康、汾酒、古井贡等区域白酒表现抢眼，交出了增长30%-90%不等的成绩单。"

洛阳杜康控股销售公司总经理苗国军透露，“今年一季度，杜康省内外市场布局及销售齐头并进，销售回款同比增长100%，销量同比增长90%以上，数倍领先于白酒行业同期平均增速，预计全年销售收入增幅将高达85%—100%，与第二位豫酒拉开较大差距。

中国酒业协会理事长王延才也对未来白酒行业的发展充满希望，“未来将进入挤出行业泡沫、促使行业健康发展的阶段，受居民收入稳定增长等因素影响，白酒行业未来依旧将保持稳定增长。”