Bernstein: China Beer January Update - Potential Green Shoots for Bud and the Restaurant Channel Despite Major CNY Timing Impact
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Bernstein reports that China's beer industry saw total value decline 16% year-over-year in January 2026, a sharp deterioration from December's 2% drop. This was primarily driven by the timing shift of the Chinese New Year, which moved 19 days later than in 2025, pushing peak sales into February.
Despite this distortion, Budweiser China showed relative improvement, with value down only 13% month-over-month, outperforming peers. China Resources Beer fell 14%, while Tsingtao Beer declined 18%, largely dragged by weakness in Shandong province. Crucially, the on-trade restaurant channel demonstrated resilience, with value down just 4%, significantly better than the 29% plunge in off-trade channels. Premium and above price segments in the restaurant channel actually grew 6%.
Budweiser showed notable strength in key coastal provinces, achieving positive value growth of 2% in Guangdong, 4% in Zhejiang, and 13% in Jiangsu. While these figures warrant attention, Bernstein cautions they are insufficient to confirm a full restaurant recovery without February data.
Bernstein maintains its Outperform ratings on China Resources Beer with a target price of HK$45 and Tsingtao Beer H-shares at HK$69. Budweiser APAC is rated Market-Perform with a target price of HK$7.75. February will benefit from softer year-over-year comparables across all brewers.