I've lived in China for a long time and I think divesting...

I've lived in China for a long time and I think divesting Penfolds would be a mistake and the company recognises this.

When people think of Penfolds they often think of the premium wines, but there are really two parts to it - bulk wines such as Rawson's Retreat and Koonunga Hill, and premium wines which is the various Bin's (ie Bin 2, Bin 8, Bin 28 etc.) and they both have a role to play in China.

People in China care a lot about brands and the presence of the higher priced wines, gives people confidence in the cheaper ones and cause them to choose those wines over other bulk wines.

TWE did not take a huge profit hit over the China tariffs and the reason for this is because they are a global consolidated company, and this allowed them to protect themselves by shuffling the deck chairs. If you buy a bottle or Rawson's Retreat in China, it no longer says Made in Australia, it says Made in South Africa. What TWE did was instead of sending the SAf bulk wine to Europe and the Australian bulk wine to China, they swapped them over. Rawson's Retreat is still in every shop that sells wine in China despite a few years of tariffs. If Penfolds had been divested they would not have been able to do this.

It is interesting that there still seems to be plenty of the premium Penfolds wines around in the shops in China. I suspect that after the Barley tariffs (May 2020) Penfolds shipped a huge volume of premium wines into the country before the tariffs came in on wine (November 2020). I am guessing that wine sales have plummeted because of the crackdown on everything that has occurred here, and Penfolds probably lifted its prices to ensure that they didn't run out. The vintages that I see on the shelves are mostly 2018. It is also possible/likely that some of it is fake, though the prices are definitely not fake (wine is at least twice as expensive in China).