(Yicai Global) Jan. 5 -- Chinese cola-flavor beverage brand Tianfu Cola has denied that it has filed for bankruptcy, after demand for its drinks skyrocketed amid alarm over the company’s rumored demise.

Tianfu Cola said in a press release posted on Weibo yesterday that the entity that is applying for bankruptcy is a previous iteration of the firm called China Tianfu Cola Group Corporation Chongqing, which ceased operating in 2018. 

Jiang Lin, chairman of the brand's current maker Tianfu Kele Chongqing Beverage, was in the firm's livestream studio this morning promoting its products as normal.

Jiang called on consumers not to stockpile the products in an irrational manner after sales of the drinks on e-commerce platform Tmall soared 1,700 percent as the bankruptcy rumors swirled online.

The now-defunct China Tianfu Cola Group Corporation Chongqing was incorporated in 1988 with registered capital of CNY12.5 million (USD1.8 million), per data from business information platform Tianyancha. 

Tianfu Cola was the first domestic cola-flavor beverage, and it became popular after being used at state banquets. The beverage was less sweet and fizzy than US brands such as Pepsi and had Chinese herbal ingredients and a relatively milder taste. It once had a 75 percent share of the Chinese cola drinks market. 

Tianfu Cola's then operator set up a joint venture with Pepsi in 1994, but the JV's performance was poor. Legal battles followed, and in 2010 Tianfu Cola took Pepsi to court for stealing its recipe for the beverage. The company successively retrieved its trademark and other assets in 2013. 

In 2018, China Tianfu Cola Group Corporation Chongqing's shareholder Chongqing Textile Holding Group transferred the group's related assets to Tianfu Kele Chongqing Beverage, which was set up that year and now owns Tianfu Cola's trademark, Yicai Global learned. 

But the company’s struggles have continued, and it posted a loss of CNY18.3 million in 2021 on revenue of CNY16.5 million, according to a notice on the Chongqing Assets and Equity Exchange.

Editors: Shi Yi, Tom Litting