Wuliangye Investment Quality Review (000858.SZ)
Data timestamp: 2026-07-24 22:04 UTC
Quality score: 82/100
Valuation position: current price/base fair value (FV) 0.77
Final signal: WATCHLIST
Core Conclusion
Wuliangye is a WATCHLIST name. The quality score is excellent and price/base FV is below 1.0, but it still needs stronger mispricing evidence and continued confirmation of conservative FV before an upgrade.
- Quality: 82/100, supported by five-year FCF, ROE, and a cash-rich balance sheet.
- Price: current price is CNY73.57 and market value is about CNY285.57 billion. Conservative/base FV is CNY87.85/CNY95.00 per share.
Business Breakdown
Consolidated main-business revenue was CNY66.21 billion in 2021, CNY73.97 billion in 2022, CNY83.27 billion in 2023, CNY89.18 billion in 2024, and CNY40.53 billion in 2025. The five-year change is -11.5%, so revenue durability must be checked carefully. Latest annual FCF was the key valuation driver, and segment margin/profit was not disclosed in the structured source.
Quality Gate
The 82/100 score places the company in the excellent bucket. Five-year average FCF/Net Income was 1.20 and OCF/Net Income was 1.29. The main constraints are segment economics, formal governance evidence, and whether the latest revenue weakness distorts normalized FCF.
Management/accounting follows the same filing-based framework for shareholder alignment, capital allocation, incentives and dilution, accounting quality, governance, and related parties.
Financial Audit
The valuation uses fiscal 2025-2021 in CNY. Latest net cash/debt was CNY126.61 billion, supported by CNY127.01 billion of cash and only CNY0.41 billion of debt. The report flags goodwill, receivables, and financial-asset composition as priority checks if they change materially.
Valuation
CNY 10Y government yield was 1.7% from ChinaBond on 2026-07-24.
| Scenario | Core Assumption | Multiple Basis | Fair Market Value | FV/Share | Price/FV | Weight | Next Check |
|---|---|---|---|---|---|---|---|
| Conservative | Normalized FCF CNY27.74bn with heavier haircut | g -1.0%, 8.0x | CNY341.00bn | CNY87.85 | 0.84 | 30% | FCF durability |
| Base | Five-year FCF and current state continue | g 0.0%, 9.0x | CNY368.73bn | CNY95.00 | 0.77 | 50% | Revenue and ROIC trend |
| Optimistic | Quality rerating without exceeding cap | g 1.5%, 11.9x | CNY450.32bn | CNY116.01 | 0.63 | 20% | Competition and capital allocation |
The balance-sheet bridge is CNY119.08 billion: cash at CNY114.31 billion, current financial assets CNY5.18 billion, non-current financial assets CNY0.0042 billion, and debt minus CNY0.41 billion. Price/base FV of 0.77 is not a 2x signal, although conservative FV still provides a visible cushion.
Buy And Monitor
Current action is watch. Upgrade requires price/base FV below 0.70, quality score at least 75, and stronger evidence that the market has over-penalized temporary conditions. Monitor revenue, FCF/Net Income, ROIC, net cash, dividends, buybacks, and governance disclosures.
Risks
Revenue decline, FCF repeatability, channel/price pressure, financial-asset composition, and shareholder-return discipline are the main risks. Two periods below 0.60 FCF/Net Income, net-debt expansion, financial-asset impairment, or dilutive dividends/buybacks/incentives would require a lower score or signal.
Research only. Not personalized investment advice.
Sources
Public quote and financial platforms supplied market and five-year baseline data. Official disclosure venues and company IR remain required for annual reports, dividends, buybacks, governance, related parties, incentives, and risks. Risk-free rate: ChinaBond, 2026-07-24.