Treasury Wine Estates' (ASX:TWE) commentary on the March quarter suggests solid depletions growth across Asia, suggesting Asia ex-China depletions grew 14% in the period, Jefferies said in a note on Wednesday.

The value of luxury exports to Asia excluding China grew 25.4% year-over-year in the March quarter.

The Chinese wine market is structurally smaller than in the pre-tariff era, particularly for higher-priced products, given anti-extravagance measures. This has been compounded by cyclically weaker domestic Chinese consumption. China is the largest export market, accounting for 25% of total exports by value and 73% of luxury exports by value.

The value of luxury exports to Hong Kong was around 14% lower in the March quarter than in the prior-year quarter. Throughout the year, Singapore surpassed Hong Kong for the value of luxury wine exported for the first time in several years.

The investment firm assigned Treasury Wine Estates a hold recommendation with a price target of AU$4 per share.