On June 5, Master Kong Holdings fell 5.64% in regular trading, trading at HK$12.23/share, with trading volume of HK$386 million. The decline was driven by a sharp rise in PET packaging material prices, a core input for the company's beverage segment, triggered by oil price increases stemming from the US-Iran conflict.

CICC noted that starting from June, as high-priced PET procurement contracts take effect, Master Kong's second-half beverage business gross margins will face significant pressure. Guotou Securities echoed this view, stating that despite some beverage companies locking in prices ahead of time, most firms will see sustained cost-side headwinds for the full year. Goldman Sachs had previously flagged that logistics cost inflation has become visible across Chinese consumer staples names since March-April, and that PET cost lock-in advantages will gradually reverse into headwinds as new procurement cycles begin in H2.

Market consensus for Master Kong's net profit growth has been revised down from 8% to 2%, with valuation currently sitting near the bottom of its five-year historical range. The broader food and beverage sector saw broad weakness, with Uni-President China down 5.18% and Mengniu Dairy down 5.96% on the same session.

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