--- title: "A bottle of 28-degree Highlight: Decoding Luzhou Laojiao's product pyramid" type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/43780471.md" description: "Lead: Recently, Luzhou Laojiao (000568.SZ) $LZLJ(000568.SZ) disclosed its semi-annual report, with revenue reaching RMB 10.472 billion and net profit of RMB 4.339 billion in the first half. The market had anticipated this. This deceleration is not due to a collapse in demand, but rather a strategic choice by Luzhou Laojiao to control volume and stabilize prices. During the industry's deep adjustment period, the company prioritizes channel health over short-term invoicing speed, aiming to maintain the price structure of Guojiao 1573, secure the low-end positioning highlighted at 28 degrees, and uphold the full-price-range matrix of 'dual brands, three product series, and key single products'..." datetime: "2026-09-07T03:11:35.000Z" locales: - [en](https://longbridge.com/en/topics/43780471.md) - [zh-CN](https://longbridge.com/zh-CN/topics/43780471.md) - [zh-HK](https://longbridge.com/zh-HK/topics/43780471.md) author: "[阿尔法工场](https://longbridge.com/en/profiles/5044766.md)" generator: "portal-rs" --- # A bottle of 28-degree Highlight: Decoding Luzhou Laojiao's product pyramid Lead: Recently, Luzhou Laojiao (000568.SZ) $LZLJ(000568.SZ) disclosed its semi-annual report. In the first half of the year, it achieved operating revenue of 10.472 billion yuan and net profit of 4.339 billion yuan. The market had anticipated this. This deceleration is not due to a collapse in demand, but rather a proactive strategy by Luzhou Laojiao to control volume and stabilize prices. During this period of deep industry adjustment, prioritizing channel health over short-term invoicing speed allows the company to refine the structural advantages of its full price-band matrix, anchored by the pricing of Guojiao 1573, the low-alcohol positioning of '28° High Light', and its dual-brand, three-series, single-product strategy. **01 28° High Light: Long Awaited Debut** On June 25, 2026, the 28° High Light was officially unveiled. As the lowest-alcohol offering in Luzhou Laojiao's core baijiu lineup, it represents the company's high hopes for youth-oriented innovation. This low-alcohol new product had early foreshadowing. At the 2024 Annual Shareholders' Meeting, management signaled that the 28° product had been successfully developed and would be launched at an appropriate time. Its eventual launch places it under the independent 'High Light' light-bottle brand introduced in 2020, rather than the previously expected Guojiao 1573 line. The strategic intent is clear: Guojiao 1573 serves as the brand asset anchor for the thousand-yuan price tier. Market feedback indicates that products below 30 degrees, targeting young leisure scenarios, have lower synergy with Guojiao's premium business attributes. By positioning 'High Light' as a third brand for the 25–35 demographic, catering to micro-intoxication, chilled drinking, and mixology, the company naturally protects the moat of the Guojiao 1573 brand. The market has responded with tangible support. According to disclosures from an analyst meeting in late August, the 28° High Light generated over 20 million yuan in sales within two months of launch. It entered the market with dual specifications: a 375ml international version at 128 yuan and a 50ml mini version at 16.9 yuan, advancing through both online e-commerce and offline new retail channels. Luzhou Laojiao stated this 'initially validates the market feasibility of its low-alcohol, youth-oriented, and light-social strategies.' This reflects the cautious logic behind Luzhou Laojiao's current approach. While low-alcoholization is a recognized growth direction in the industry, Luzhou Laojiao first tests the waters, runs scenarios, and verifies sell-through using 'High Light,' a small-scale brand with low trial-and-error costs. This grants greater freedom for exploration in product innovation and marketing. If successful, it will open space for subsequent product layouts and expansion. This slowness is the composure that comes after accumulation. In fact, low-alcoholization was a move laid out by Luzhou Laojiao over twenty years ago. When Guojiao 1573 was launched in 2001, 52° and 38° versions were released simultaneously, nearly a full cycle ahead of the industry's collective shift to low alcohol. Today, the 38° Guojiao 1573 has become the industry's first ten-billion-yuan low-alcohol baijiai single product. In its main Hebei market, it accounts for about 80% of Luzhou Laojiao's sales, holding over 70% of the low-alcohol premium market share, with annual sales exceeding 1.5 billion yuan in the Taihu Lake region. Thus, the 28° High Light appears to be a fresh attempt at youth engagement but is actually building upon two decades of low-alcohol expertise from the 38° Guojiao 1573. Luzhou Laojiao is not chasing trends impulsively; it is transferring a proven low-alcohol methodology from the 38° business-light-premium segment to the 28° daily-light-drinking segment. The strategy involves deepening penetration in one province before expanding nationally, and validating quality through the premium sequence before using an independent brand for younger scenarios. This caution is grounded in time. **02 Premium Leadership, Low-Alcohol Push, Matrix Support** Examining Luzhou Laojiao's product layout reveals a clear logic: premium leadership, low-alcohol momentum, and matrix support, with three lines jointly driving competitiveness across all price bands. Consequently, Luzhou Laojiao has formed a 'dual-brand, three-series, single-product' strategy. Guojiao 1573 leads the premium tier (900–1000 yuan coordinate), the Luzhou Laojiao series (Tequ, Jiaoling, Touqu) covers sub-premium, mid-range, and mass markets, while High Light and other sub-brands cater to ultra-low alcohol and young light drinking. In the semi-annual report, revenue from other alcoholic beverages reached 1.211 billion yuan, with gross margin expanding 147 bps YoY to 45.80%, providing a buffer in the mid-tier and mass segments. If any price band faces pressure, other tracks can compensate; if consumer habits shift, the brand has reserve teams ready. When business banquet scenarios shrink, 38° Guojiao and Tequ step up for banquets and gifting; when young people distance themselves from high-alcohol dinners, 28° High Light takes over for gatherings, chilled drinking, and music festivals. Having experienced the previous cycle, management judged at the June 2026 shareholders' meeting that this round represents structural transformation rather than a short-cycle fluctuation, noting that 'past experience cannot be simply applied.' Therefore, this 'slowness' is not conservatism, but a proactive choice based on a clear judgment of the cycle. They understand better than anyone that intergenerational trust in premium baijiu is thinner than in 2013, necessitating strict adherence to price stability. Zooming back into the financial statements, this slow-variable strategy is backed by a clear ledger of trade-offs. A set of numbers illustrates the point: In H1, mid-to-high-end wine revenue was 9.2 billion yuan with a gross margin of 90.74%; overall alcohol gross margin stood at 85.51%. Operating cash flow was 2.082 billion yuan, monetary funds 26.13 billion yuan, and the asset-liability ratio 28.67%. Amidst 承压 in premium consumption in H1 2026, margins held firm, cash flow remained uninterrupted, and liquidity did not dwindle—a solid fundamental base maintained even under active production control. Management clarified at the June shareholders' meeting that Guojiao 1573 would not see price cuts. Dealer inventory is approximately seven months (with very thin terminal inventory), and wholesale prices have not suffered systemic breakdowns, keeping the brand anchors of the top three premium baijiu players firmly intact. Connecting these actions from the first half of the year, the ledger of sacrificing short-term gains for long-term value is clear: trading current growth speed for future long-term brand equity. Once industry clearing is complete and the next consumption cycle begins, those who remain at the thousand-yuan table will be positioned where the next generation of consumers has already taken their seats. One wine table reserved for the strong aroma of the older generation, another for the micro-intoxication of the youth. Through its 'dual-brand, three-series, single-product' matrix, Luzhou Laojiao connects two generations on the same brand landscape. ### Related Stocks - [000568.CN](https://longbridge.com/en/quote/000568.CN.md) --- > **Disclaimer: This article is for reference only and does not constitute any investment advice.**