Buyback plan boosts Moutai stock price (2)

Investors are not fully convinced. "I think today's share jump can be better described as a temporary rally, which can not last long," Zhao Yong, an industry analyst with Haitong Securities in Shenzhen, told the Global Times, noting that the company's buyback plan is a critical factor in the stock rally.

According to a statement the company filed to the Shanghai Stock Exchange late Tuesday, it will increase its shareholding over the upcoming six months to 61.8 percent from the current 61.76 percent, to boost market confidence in shares which have been declining since last month.

In the past two years, several companies have been exposed for using plasticizers as a food additive to make beverages thicker and more appealing, according to media reports.

"Liquor doesn't need to be thickened to taste good anyway," Liu Yuan, secretary general of the China National Association for Liquor and Spirits Circulation, told the Global Times. He suspected that some people might have made a lot of money on the recent fluctuation of liquor shares.

The contamination scandal sent shares sliding for many listed liquor producers in China, as consumers wondered whether others in the sector might have the same problem.

Jiugui Liquor Co, another high-end liquor producer in China, announced on November 27 that it would halt some of its production in order to rectify the excessive content of plasticizer, which was exposed by the media in mid-November.