Wuliangye Yibin Co.,Ltd., embroiled in a financial restatement controversy, recently held its first extraordinary general meeting of 2026 in Yibin, Sichuan. This meeting drew significant attention from the capital markets as the company navigates a turbulent period. In February, the company's former chairman, Zeng Congqin, was placed under investigation by Yibin authorities, and a successor has yet to be appointed for this leading baijiu producer, second only to Kweichow Moutai.

On April 30, Wuliangye released several announcements, including its 2025 annual report and Q1 2026 report. It also issued a "substantial" adjustment to its performance figures for the first three quarters of 2025, which shocked the market. According to the restatement, the company's operating revenue for the first three quarters of last year was revised down from 60.9 billion yuan to 30.6 billion yuan, a reduction of 30.3 billion yuan. Net profit attributable to shareholders was adjusted from 21.5 billion yuan to 6.5 billion yuan, a cut of 15 billion yuan.

Following this performance revision, Wuliangye's stock price has continued to decline, recently falling below 90 yuan. The share price opened at 97.74 yuan on April 30 and closed at 85.78 yuan on May 19.

At the extraordinary meeting, Hua Tao, Vice Chairman and General Manager of Wuliangye, apologized on behalf of the management team: "The release of the financial report caused confusion in market expectations. I sincerely apologize to all shareholders on behalf of the company."

The question remains: Will shareholders accept this response from Wuliangye amid its financial restatement storm?

**1. Wuliangye in the Storm: An Emergency Meeting**

Wuliangye has not been keen on holding extraordinary general meetings in recent years. Public records show that since 2022, apart from this recent meeting, only one other was held on December 31, 2024. That meeting primarily reviewed three proposals related to shareholder return plans, interim profit distribution, and board adjustments.

Since shareholder return and profit distribution plans directly affect investors' interests, that meeting attracted significant participation. According to the announcement, 146 shareholders voted on-site, and 8,615 voted online, representing 67.4% of the company's total shares.

In contrast, the 2023 annual general meeting held on June 28, 2024, had 109 on-site voters and 1,552 online voters—both figures lower than the extraordinary meeting. However, the shares represented at the annual meeting were higher, accounting for 72% of the total.

"This suggests that retail investors showed greater enthusiasm for the 2024 extraordinary meeting," an analyst familiar with Wuliangye noted. "This year's extraordinary meeting followed a similar pattern."

According to Wuliangye's announcement, 115 shareholders voted on-site at the May 18 meeting, with 6,560 voting online. These shareholders represented 60.2% of the company's total shares. For comparison, the 2024 annual general meeting held on June 20 last year had only 56 on-site voters and 5,224 online voters, representing 66.8% of total shares.

The recent extraordinary meeting reviewed four proposals: a share repurchase plan via centralized bidding, the formulation of a compensation system for directors and senior executives, the election of non-independent directors for the seventh board, and the 2025 profit distribution plan. All four proposals were passed with high approval rates.

The "share repurchase" and "profit distribution" proposals garnered particular attention from investors and the market, as they involve a 20-billion-yuan return to shareholders. According to the repurchase plan, Wuliangye will use 8 to 10 billion yuan over the next 12 months to buy back and cancel shares. The profit distribution plan proposes a cash dividend of 25.78 yuan per 10 shares (before tax), totaling approximately 10 billion yuan.

Late last year, Wuliangye announced and implemented a 2025 interim dividend plan, also distributing about 10 billion yuan in cash dividends. At the meeting, management stated that the 2025 dividend funds would be transferred to shareholder accounts within two months.

Additionally, management indicated it would actively follow up on major shareholders' share purchase plans. In early June, Wuliangye Group proposed a 3 to 5 billion yuan share purchase plan to be implemented within six months. The company also stated it would initiate the preparation of a new shareholder return plan for 2027–2029 at an appropriate time.

**2. Stock Price Plummets by Three-Quarters**

The share repurchase, cash dividend, and major shareholder purchase plans are all measures aimed at countering pessimistic sentiment in the capital market and restoring investor confidence in Wuliangye.

However, secondary market reactions suggest these "sincerely favorable" policies have not been well-received. On May 18, the day of the extraordinary meeting, Wuliangye's stock fell by 1.5%. On May 19, it gained a mere 0.25%, showing a weak rebound that failed to reflect the expected boost from these significant positive measures.

Currently, Wuliangye's stock price has fallen by three-quarters from its peak of 334.81 yuan.

"This urgently convened extraordinary meeting is itself an emergency response by Wuliangye's management to the capital market," a Wuliangye shareholder analyzed. "Over the past two years, Wuliangye's annual general meetings have been held in mid-to-late June, following a stable and routine schedule. Breaking convention to hold this extraordinary meeting clearly aims to use real money to stabilize the stock price."

The动摇 of market confidence stems directly from the performance correction announcement on April 30.

Wuliangye defined this large-scale financial restatement as a correction of prior accounting errors and a prudent adjustment of reporting standards. However, this official explanation has failed to dispel market doubts, and panic continues to spread.

The performance correction report drew widespread attention in the capital markets, with several top international investment banks issuing "bearish" assessments.

For example, in a May 4 research report, Citi downgraded Wuliangye from "Buy" to "Sell," slashing its target price from 181.3 yuan to 72.2 yuan—a reduction of over 60%, reflecting unprecedented bearish sentiment.

Citi's core argument pointed to fundamental operational issues: The essence of this financial restatement is not merely an accounting error but a清算 of long-standing practices, including forced inventory loading on distributors, inflated channel inventory, premature revenue recognition, and artificially boosted revenue and profits. The previously impressive performance figures contained significant水分, and the actual operational quality is far lower than market perception.

Citi also significantly lowered its future profit forecasts for the company, reducing its 2026 net profit estimate by 51% and its 2027 estimate by 47%. It assigned a price-to-earnings (P/E) ratio of only 17 times, a nearly 50% discount to Kweichow Moutai's target P/E, and initiated a 30-day short-term negative outlook.

Goldman Sachs followed suit with a bearish view, downgrading Wuliangye from "Buy" to "Sell" and cutting its target price from 133 yuan to 83 yuan. It echoed the logic of channel inventory overhang and业绩泡沫出清, stating that short-term operational uncertainty has significantly increased and there is still room for further valuation downgrades.

However, the market is not uniformly bearish. In contrast to the views of foreign investment banks, domestic securities firms have expressed more supportive stances.

For instance, Huachuang Securities maintained a "Buy" rating. Its research report noted that Wuliangye's proactive review of its business model and retrospective adjustment of quarterly reports based on the prudence principle better reflect真实的销售表现. "This adjustment is more about changes in revenue recognition standards and does not alter actual operations. The company's asset-liability structure remains稳健."

The current market debate is clear: Bears focus on historical performance inaccuracies, channel inventory risks, and short-term earnings pressure. Bulls emphasize the industry leader's barriers, its hundred-billion-yuan cash reserves, high dividend returns, and potential for valuation recovery at current lows.

**3. Wuliangye Falls Further Behind Moutai**

The baijiu industry is currently in a period of deep adjustment, with challenges such as price倒挂, high inventory, and reduced consumption scenarios weighing heavily on producers and distributors.

At the extraordinary meeting, Wuliangye's management addressed these industry difficulties and its own development challenges.

For example, Wuliangye is deeply affected by price倒挂. The ex-factory price of its core product, the Eighth Generation普五, remains at 1,019 yuan per bottle, but the终端市场批价 has long hovered between 820 yuan and 840 yuan. On e-commerce platforms, prices can be as low as 750 yuan per bottle, resulting in a price倒挂 of over 200 yuan per bottle.

This prolonged price misalignment has left many distributors in a被动局面 of "losing money on every bottle sold," continuously压缩 their profit margins. It has also affected distributors' willingness to make payments and the initiative of终端动销. To maintain cash flow, some distributors have opted to clear inventory at thin margins, further扰乱 the national price system and creating a恶性循环 of "low prices – slow sales – lower prices."

The root cause of price倒挂 is the historical burden of persistently high channel inventory. Over the past few years, Wuliangye relied on its distributor network to rapidly scale up, which led to a certain经营惯性 of "pushing inventory to boost performance," resulting in严重积压 of channel inventory.

Addressing price倒挂 and inventory issues at the meeting, Wuliangye's management stated that the current core task is prioritizing稳定终端销量,稳固市场批价, and持续消化渠道库存. In the short term, the company will not急于出台提价-related policies—it will wait until批价 "steadily stands above 1,000 yuan" and market consumer demand fully recovers before审慎商议提价事宜.

This cautious approach reflects the long-accumulated operational pressures and industry pain points Wuliangye faces, as well as the现实困境 the company must confront.

In stark contrast to Wuliangye's审慎守势 is Kweichow Moutai's稳步进取 market-oriented节奏. Over the past two months, Moutai has raised prices twice.

On March 31, Feitian Moutai updated its price system,同步上调出厂价 and retail prices, ending an eight-year period of a固化的零售价 at 1,499 yuan per bottle. On May 16, Moutai再次扩容调价范围, increasing prices for four non-standard products, including陈年茅台,精品茅台, and生肖茅台,完善梯度化价格体系.

Simultaneously, Moutai adjusted the sales time on its i Moutai platform and the operating hours of its offline stores. The i Moutai sales time changed from 9:00 a.m. to 8:00 p.m., and offline store hours shifted from 9:00–18:00 to 10:00–20:00. These adjustments better align with consumers'酒 buying habits.

"Moutai has the底气 to raise prices. Although its market price has declined from peak levels, it still remains above the official指导价. These two price increases reflect Moutai's practice of adjusting prices according to market conditions," said a资深白酒从业者 who represents both Moutai and Wuliangye. "In comparison, Wuliangye currently确实没有提价空间."

In this从业者's view, the landscape of China's premium baijiu continues to differentiate. In recent years, Wuliangye has consistently been the second-highest高端白酒 after Feitian Moutai, with the high-end segment experiencing "普涨共进."

However, the gap between the two is gradually widening—a situation Wuliangye显然 does not want to see.