(Bloomberg) -- Kweichow Moutai Co., the world's most valuable spirits maker, will raise liquor prices 18 percent in 2018, the first increase in five years for its signature drink, amid rising demand for premium liquor.
Moutai also expects liquor sales volume to grow 34 percent in 2017 from a year earlier, the Chinese company said in a statement Thursday. Profit will rise about 58 percent this year on higher demand for liquor as China's middle class embraces a more affluent lifestyle, the company forecasts. The shares gained 3.4 percent as of 9:25 a.m. in Shanghai trading.
Rivals have also been raising prices. Wuliangye Yibin Co, the nation's second-largest liquor maker by market value, lifted retail prices three times this year. Chinese baijiu maker Sichuan Swellfun Co, owned by Diageo Plc, also had an increase in July, China's official Xinhua News Agency reported. State-owned Moutai had emphasized earlier this year that prices should be based on affordability for mass customers, and that the group would take action to stabilize market prices and wouldn't pursue excessive profits from the business.
Moutai's shares have gained 99 percent this year. The runup has caught the attention of state-run media, with China's Xinhua saying last month the shares had been rising too fast.
To contact the reporter on this story: Daniela Wei in Hong Kong at jwei74@bloomberg.net.
To contact the editors responsible for this story: Jeff Sutherland at jsutherlan13@bloomberg.net, Dave McCombs
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