Morgan Stanley cuts China Resources Beer’s 2026 profit forecast by 9.5%

Two major banks have cut their forecasts for China Resources Beer, pointing to weaker demand in China’s restaurant and bar trade and a slower growth outlook for the brewer over the next several years.

According to analyst notes dated Aug. 23 and reproduced by Sina Finance, Morgan Stanley lowered its 2026 recurring profit forecast for China Resources Beer by 9.5% to 5.5 billion yuan, while Bank of America also reduced its earnings expectations and cut its price target on the stock. The revisions are forecasts by analysts, not company results.

Morgan Stanley’s new 2026 profit estimate implies a previous forecast of about 6.08 billion yuan, meaning the bank removed roughly 577 million yuan from its earlier view. The bank also cut its target price for the shares to HK$30 from HK$35, a drop of HK$5, or 14.3%.

In its outlook for the beer business, Morgan Stanley said it now expects revenue to grow 3% in 2026. That projection depends mainly on modest gains in pricing rather than a strong pickup in volumes. The bank expects beer volume to rise 0.9% and average selling price to increase 1.7%, suggesting that growth would come more from product mix and pricing than from a large increase in liters sold.

That matters because China Resources Beer is one of the country’s largest brewers, and investor expectations have long depended on its ability to move consumers toward more premium products while protecting profitability in a difficult consumer market. A weaker demand picture in hospitality channels can limit that strategy because those venues are often important for higher-margin beer sales.

Bank of America also turned more cautious. According to the note reproduced by Sina Finance, the bank lowered its target price to HK$29.1 from HK$30.8, a reduction of HK$1.7, or 5.5%. It also cut its earnings-per-share forecasts for 2026 and 2027 by 7%.

The two revisions point in the same direction. Both banks appear to be signaling lower confidence that consumer demand in China’s on-premise drinking market will recover quickly enough to support stronger beer sales. That leaves China Resources Beer relying more on pricing, product mix, and margin management than on broad-based volume growth.

The changes are also important because analyst models for 2026 through 2028 are used by investors to judge not only sales trends, but also volume, average prices, profitability, and how much the stock should be worth. Lower profit forecasts and lower target prices do not guarantee weaker market performance, but they often shape near-term sentiment around a company, especially when more than one large bank moves in the same direction at the same time.

China Resources Beer has operations beyond mainstream brewing and also owns a baijiu business, which means its overall performance is not tied only to beer. Still, the figures cited in the broker notes focus heavily on the beer segment and on signs that demand in China remains soft enough to force a more cautious view of future growth.

Neither of the reports appears to be publicly available in full, and the figures cited here come from their reproduction by Sina Finance. China Resources Beer had not reported these forecast changes itself; they reflect the judgments of outside analysts reviewing the company’s prospects in China’s beer market.