(Yicai Global) Dec. 25 – The world's largest liquor maker by market value, Kweichow Moutai, yesterday launched 12 new construction projects, with a total investment of CNY15.8 billion (USD2.3 billion), which will not only boost the Chinese company's production capacity of major spirits, including the signature Maotai, but also enhance its packaging, storage, logistics and raw material supply capacity.

All of the 12 projects are in southwest China's Guizhou province, where Kweichow Moutai is based. After completion of the capacity expansion, the firm's Maotai production volume will rise from nearly 50,000 tons now to 56,000 tons and the capacity for another spirit brand Xi will jump to 50,000 tons, The Paper reported.

Because the quality of Maotai is closely related to the source of water, it is difficult to build factories in other places. So although the retail price of Maotai has soared in recent years, the company has been moving slowly to raise capacity.

Among the projects launched yesterday are an automated liquor packaging production line and supporting logistics facilities which can meet the demand of 80,000-ton liquor volume; a 30,000-ton capacity warehouse; a glass bottle plant with an annual capacity of 153,000 tons; a high-standard planting base for sorghum rice, the main brewing raw material; and a historical and cultural neighborhood featuring the Maotai liquor brand.

Kweichow Moutai plans to invest CNY60 billion to improve its infrastructure consisting of 30 major projects, according to the firm's recently released plan. The 12 projects commenced yesterday are part of the plan.

Kweichow Moutai is expected to report CNY100.3 billion in operating revenue this year, exceeding CNY100 billion for the first time in its history. It posted CNY85.9 billion in revenue last year, Li Baofang, the firm's chairman, said on Dec. 16. The firm's revenue has expanded nearly 100 times over the past 20 years.

Editor: Peter Thomas