CITIC Securities: The recovery in Q3 food and beverage sector fund holdings suggests adding leading liquor companies at the bottom of the industry

The Zhitong Finance App learned that CITIC Securities released a research report saying that in 2026Q3, the size and share of fund holdings in the food and beverage sector have rebounded steadily, mainly due to the decline in the Q3 technology investment market, and some funds have returned to leading consumers with stable fundamentals and attractive dividend returns. Looking at the molecular sector, the share of liquor holdings increased most significantly in Q3. Among popular products, the share of dairy products rebounded the most, and other sub-sectors basically showed varying degrees of month-on-month recovery. Looking at individual stocks, leading liquor companies are still the main players in fund holdings. The number of heavily held funds such as Kweichow Moutai, Shanxi Fenjiu, and Gujing Gongjiu have all increased, and leading positions in dairy products and food supply are relatively stable. In terms of investment proposals, it is recommended to increase the allocation of leading liquor companies at the bottom of the industry; popular products suggest three main lines: 1) Competition improvement dimensions. 2) High dividend dimension. 3) The dimension of healthy growth and prosperity.

CITIC Securities's main views are as follows:

The heavy funding for food and beverage has rebounded steadily, but the allocation is still low.

2026Q3, the food and beverage active equity fund had a heavy position size of 41.2 billion yuan, +11.4% year over year, accounting for 2.1% of holdings, and -2.0/+0.6 ppts year-over-year, respectively. The share of food and beverage holdings rebounded steadily after 11 consecutive quarters of decline. The bank believes that some of the funds have returned to stable/high dividend assets, mainly due to the fact that early food and beverage capital payments were sufficient and the chips were clean. Along with the decline in the technology market starting in 26Q3, the bank believed. Despite a steady recovery in heavy fund positions, the overall balance of food and drink is still in a low state.

Liquor holdings rebounded the most month-on-month, and other sectors also received additional allocations.

Looking at the molecular sector, the share of liquor fund holdings has rebounded the most. The main reason is that the liquor industry has gradually bottomed out in terms of price, sales, and inventory, and that liquor is a large market capitalization sector. Leading companies have strong operating resilience, and dividend rates under current stock prices are attractive. They are usually the first choice for the return of capital to the consumer sector. Among popular products, dairy products have entered an upward cycle, and the fundamentals of leading companies are expected to improve, and the share of fund holdings has increased a lot from month to month; other sectors, including condiments, frozen food, and non-dairy drinks, all increased slightly month-on-month. Condiments and frozen foods are mainly due to steady operation of leading companies, market expectations of price increases for leading companies, and non-dairy beverages mainly due to the market's increase in high-dividend assets.

Liquor leaders are still the main holdings, and leading dairy and food supply positions are stable.

Looking at the individual stock situation, leading liquor companies in 2026Q3 are still at the top of the market value of heavy holdings. Kweichow Moutai, Shanxi Fenjiu, and Gujing Gongjiu have all received increased allocations. In terms of popular products, Yili Co., Ltd., Yasui Foods, Angel Yeast, and Haitian Flavors maintained a high level of holdings. Although demand in the 2026Q2 segment was under pressure and market confidence declined, the dairy products and catering supply chain sector maintained strong financial capacity.

Risk factors:

Consumer sentiment declined; food and beverage recovery fell short of expectations; price increases fell short of expectations; industry competition intensified; the impact of emerging channels exceeded expectations; raw material prices continued to rise; food safety issues, etc.