Kuaijishan Shaoxing Wine Co Ltd plans to raise up to 200 million yuan (US$26.7 million) in an initial public offering as early as next year to fund research and development and raise brand awareness.

Kuaijishan, which has the capacity to produce 120,000 tons of its self-branded rice wine a year, hired Guosen Securities Co Ltd to underwrite its IPO, Fu Zukang, the wine maker's general manager, told Shanghai Daily over the weekend.

"The Shanghai Stock Exchange is our targeted listing market," Fu said. "But the application hasn't been submitted to the stock regulator yet."

Shaoxing, Zhejiang Province-based Kuaijishan has developed from a small rice wine producer dating back to 1743 to a private enterprise with one billion yuan in total assets.

The wine maker said its annual sales have been growing by 20 percent over the past three years. Revenue reached 550 million yuan last year and is expected to hit 700 million for this year, Fu said.

China is the world's biggest consumer of rice wine, selling 2.8 million tons every year, including 1.2 million tons for drinking and the rest for cooking. Most of the rice wine is sold in Zhejiang and Jiangsu provinces in east China.

"Although the industry maintained more than 10 percent growth annually, geographical sales limitations and overlapping products are two major hurdles for further expansion," said Lu Ronghua, director of Shanghai's Wine Monopoly Bureau.

Kuaijishan's Fu said the stock listing will help "expand brand awareness and further spur sales across the country and the world." The company launched a new product targeting the Shanghai tastes and expects it to generate one million yuan in sales revenue by 2010, helping Kuaijishan win a 50 percent market share.

Kuaijishan now holds a 30 percent share of the rice wine industry nationwide, second only to Shanghai-listed Zhejiang Guyue Longshan Shaoxing Wine Co Ltd, which has 50 percent.

(Shanghai Daily September 3, 2007)