1H/2026 preview: Earnings in greater focus amid a weak consumption backdrop; Policy key to watch

Research evidence excerpt

1H/2026 preview: Earnings in greater focus amid a weak consumption backdrop; Policy key to watch

Equity Research

10 July 2026 | 4:47PM HKT

CHINA CONSUMER STAPLES

1H/2Q26 preview: Earnings in greater focus amid a weak consumption

backdrop; Policy key to watch

2Q saw a broad-based sales deceleration on unfavorable weather and weaker Leaf Liu

+852-3966-4169 | leaf.liu@gs.com

consumption sentiment following a robust 1Q recovery from a CNY boost. Goldman Sachs (Asia) L.L.C.

Revisiting our outlook in early 2Q and May/June tracker data, we note that volume Valerie Zhou

has weakened more than expected (esp for beer/beverages) and Staples companies +852-2978-0820Goldman Sachs (Asia)| valerie.zhou@gs.comL.L.C.

remain cautious on pricing actions with now moderating cost pressure from PET/oil. Christina Liu

Meanwhile key bright spots remain for sector outperformers (Buy rated +852-2978-6983Goldman Sachs (Asia)| christina.liu@gs.comL.L.C.

Mengniu/Yihai/CR Beer/Nongfu and Haitian-H still resilient). We note four core

investment themes to watch for: 1) channel reinvention 2) operational

turnaround (with easing cost pressure) 3) product strongholds and 4) dividend

support into 2H26:

n Channel reinvention and reshaping of the value chain: Value retailers are

scaling much faster than expected, with the contribution in channel mix growing

more significantly for F&B brands (Exhibit 2). Margin from value retailer channels

remains stable for F&B brands given operating efficiency. That said, F&B brands

are growing more cautious on the rising mix % of value retailers and their

stronger bargaining power. Meanwhile, O2O/B2B are also becoming more

meaningful growth drivers for volume and new product rollout across

beer/F&B/snacks/condiments, where brands see strong DD% growth and are