Wuliangye has been too hot in recent years. Counting from the low point in January 2014, it has been less than 6 years and has increased 35 times. During the same period, Kweichow Moutai is 38 times, Shanxi Fenjiu is 14 times, and Luzhou Lao Jiao exceeded 13 times, and Yanghe shares less than 13 times. Wuliangye is only a little worse than the wine king Moutai. Behind the many masters in Wuliangye’s throat and slasher, what gives him so much power? With this question, I started to read Wuliangye’s annual report.
I read Wuliangye’s annual report, starting from the prospectus, and then to the 2001 annual report that can be collected, from the listing in 1998 to the annual report in 2000 I didn’t find it. I looked all the way and wrote down something when I saw it. I wrote an article when I could write. After reading the annual report of Comrade Wang Guochun’s tenure, I wrote an article about Wuliangye under Wang Guochun’s rule. Similarly, I also wrote an article about Comrade Tangqiao’s underestimated doer in Wuliangye—the reformer Tangqiao. Comrade Liu Zhongguo, although he is the chairman with the longest term after Comrade Wang Guochun, with a term of 9 years, he is really not worth seeing. I don’t know where to write, so he didn’t continue to write specifically. Liu Zhongguo chapter. This article will study the source of Wuliangye’s rapid growth in recent years in a chronological and exploratory manner.
1. Impressions during Liu Zhongguo’s tenure
During Comrade Liu Zhongguo’s tenure, I was most impressed by three things. One is The pessimistic description in mid-2014, the second is the non-public issuance in 2015, and the third is the low interest rate on large deposits.
1. The year of panic in 2014
The situation of”both volume and price rising together” no longer exists, relying on the upward price of high-end liquor to stimulate the explosive growth of the entire industry The era of is gone forever. How pessimistic this description is, and looking back, how wrong this description is. Of course, one cannot look at the situation at the time through the eyes of a rearview mirror. But in the same environment, Moutai, which is also the leader in liquor, has published four”unchanged” conclusions.
The liquor industry is a traditional Chinese industry. Four of its developments have not changed so far:First, liquor has not changed as a carrier of emotional communication among Chinese people; second, liquor as one of the cultural symbols of the Chinese nation has not changed; The third is that liquor as a favorite consumer product of Chinese people has not changed; the fourth is that the traditional customs and cultural habits of Chinese people’s consumption of liquor have not changed.
This is a classic passage that is widely spread. The realm of Maotai’s leaders at the time was really high, and he saw the essence through phenomena. In contrast, Wuliangye’s pessimism, the contrast is still quite big.
2. Non-public additional issuance
The proposal for additional issuance was passed in 2015. This is the only additional issuance since Wuliangye went on the market. It has been criticized and puzzled. I don’t understand why it is necessary to issue additional funds. The plan is to raise 2.3 billion yuan. At that time, the monetary funds on hand exceeded 26.3 billion, and most of the monetary funds are in the form of bank deposits, which can be used at any time to raise such a small amount of money. What’s the use?
The only reasonable explanation is the employee stock ownership plan, but the proportion of the employee stock ownership plan to the total funds raised is too low, one third Not. This non-public issuance finally landed in 2018. On April 20, 2018, the company’s non-public issuance of shares and employee shareholding plan was completed. The number of non-public issuance is 85,641,285 shares, and the issue price is 21.64 yuan. /Share, the total amount of raised funds is 1,853,277,407.40 yuan, and the net amount of raised funds is 1,815,032,613.98 yuan.
Employee stock ownership, own employee stock ownership methods, such as equity incentives, etc., are normal operations. Through additional issuance, most of them are sold to Organization, this is a bit incomprehensible, the key is that it is not short of money.
3. A large amount of deposits eat low interest rates
On October 24, 2012, Wuliangye’s fourth board of directors of the 22nd meeting deliberated and approved, Wuliangye and YibinWuliangye Group and its 6 subsidiaries, ABC International Holdings Co., Ltd. jointly invested in the establishment of Sichuan Yibin Wuliangye Group Finance Co., Ltd., with registered capital 2 billion yuan, of which Wuliangye invested 720 million yuan, accounting for 36%of the registered capital. By 2014, this financial company was formally established.
Since 2014, Wuliangye has signed a”Financial Service Agreement” with Wuliangye Group Finance Co., Ltd. every year. The main content of the agreement is to limit Wuliangye’s daily deposit balance in the financial company to no more than many yuan. For example, in 2014, the daily deposit balance was limited to no more than 5 billion yuan.
I have calculated the amount of money Wuliangye deposited in the financial company and the interest received each year. I don’t know, the interest rate is really low, and it’s still a year. Save more than a year. With so much money, there is no place to spend it, and I don’t want to give credit to shareholders, and don’t do investment and financial management. It’s a waste. It’s better to save it regularly and buy government bonds.
Two. Three years of sealing the throat with a sword
During the tenure of Comrade Liu Zhongguo, the famous Li Shuguang Comrade Li Shuguang appeared in 2017. Comrade Li Shuguang served as the chairman of Wuliangye Group Company. The brief introduction is as follows:
Mr. Li Shuguang, bachelor degree. Joined the work in July 1983, successively worked and served in the Sichuan Provincial Department of Machinery Industry, Sichuan Provincial Planning and Economic Commission, Sichuan Provincial Economic Commission, Sichuan Provincial Economic and Trade Commission, Sichuan Provincial Economic Commission, Sichuan Provincial Economic and Information Commission. He used to be Assistant Mayor of Luzhou Municipal People’s Government, Sichuan Provincial Government State-owned Enterprise Supervisory Board, Chief Economist, Deputy Director, and Deputy Secretary of the Party Leadership Group of Sichuan Economic and Information Commission. The current party secretary and director of the company, party secretary and chairman of the group company
We know that after Comrades Wang Guochun and Comrade Tang Qiao retired to the second line, they both went to Wuliangye Group Company as chairman of the board. Comrade Li Shuguang was also the chairman of the group company. Comrade Li Shuguang was obviously different from them. First of all, Li Shuguang was directly transferred to the chairman of Wuliangye Group Company, not from Wuliangye Co., Ltd. Again, Li Shuguang was only 55 years old when he was transferred. Compared to their 60-year-old chairman of the group company, Li Shuguang is younger and more powerful. Finally, the most important thing is that Li Shuguang received his salary from Wuliangye Co., Ltd. From the perspective of his salary, Comrade Li Shuguang was not directed at the director when he appeared. Coming from the empty head post.
Although the position has not changed, the core has changed. When Comrade Li Shuguang took office, the power has been transferred to him. The chairman of Wuliangye Group Company is no longer a second-line position. Why did this happen? This change must be considered by some people, not from the internal considerations of the stock company, but from outside forces. I don’t know if it will change in the future, but behind this change, it must be hoped that Wuliangye will do better. After all, during the industry adjustment period, Wuliangye did nothing to do well.
In fact, when Comrade Li Shuguang came to power, Wuliangye’s performance was indeed very good. From 2017 to 2019, the three-year revenue growth rate was 23%, 32.6%, and 25.2%, respectively. Net profit The growth rates are 42.9%, 39.2%and 29.8%respectively. It is precisely because of this high-speed growth that this article has the description of a sword to seal the throat.
In the past three years of rapid growth, what Li Shuguang did right? I seriously searched for the answer between the font lines of the annual report. What he did, it seems that he didn’t do anything too obvious. Expanding production capacity, only continuing to optimize the conventional quality improvement operation of base wine storage, and the company system has not changed significantly. Although the assessment system has been adjusted, I guess it is also a pavement for his authority. The establishment of such an engineering technology research center certainly has no effect on short-term performance. It has not solved the historical problems left by Wuliangye, and has not prevented the incomprehensible non-public issuance. The deposits used to collect low interest rates are also being used more and more. Li Shuguang’s reform, I really didn’t see any wonderful content. What has prompted Wuliangye’s rapid development in recent years? I think he has spotted the trend of high-end products in 2017, and made a strategic layout in advance.
Although the 60 billion yuan has not yet broken through, but the high-end volume of Moutai spillover has been achieved. All strategies are carried out around the core brand Wuliangye.
Why did this strategic adjustment be made? In addition to Comrade Li Shuguang’s strategic vision, I think it is also a historical necessity for Wuliangye. Why do you say that? During the in-depth adjustment period of the industry, Wuliangye has been adopting the”1+5+N” brand strategy, and vigorously promoted new products and new brands at low and medium prices.
And this”1+5+N” brand strategy has been proven to be a failure in 2017. Therefore, I think this strategic transformation also has historical inevitable elements. Of course, Comrade Li Shuguang’s strategic vision and strategic execution ability are also indispensable.
3. Wuliangye’s follow-up development potential
In my article about Comrade Wang Guochun, I demonstrated Wuliangye’s base wine production capacity , Combined with Lao Tang’s data on the production capacity of Wuliangye base wine, based on his data, the production capacity of base wine that can be used for Wuliangye and above quality products is approximately 23,200 tons. Since then, there has been no further increase in production capacity. Whether it is the Tangqiao era or the Liu China era, judging from the current annual report and announcement, there is no follow-up production plan.
As mentioned earlier, Li Shuguang’s strategic goal is”the core brand Wuliangye puts 30,000 tons in the market”, 23,200 tons of base wine, corresponding to 30,000 tons of commercial wine, I think the volume of commercial wine A ceiling has been reached, at least the ceiling is already there and can be seen. Therefore, the follow-up development of Wuliangye will not be as brilliant as the three years from 2017 to 2019. The growth momentum is more the price increase of the product, the improvement of the quality rate and the increase of the series of wines, and this requires gradual progress. Yes, it can’t be done overnight.
Wuliangye is an excellent company, and Comrade Li Shuguang is also an excellent entrepreneur. The rapid development in the past few years is indeed very exciting. It is a sword that seals the throat and cuts into the invisible, thanks to Comrade Wang Guochun’s hard work and expansion, Comrade Tang Qiao’s reform and optimization of the corporate environment, and Comrade Li Shuguang’s excellent strategic vision. It is the hard work of these outstanding entrepreneurs that tells such a wonderful story of Wuliangye, and also allows Wuliangye’s shareholders to obtain generous returns. Text:Danyue Xingwei