China’s Xige Estate Secures Nearly RMB 100 Million in New Funding

Ningxia’s Xige Estate has raised nearly RMB 100 million (US$14.9 million) to help fund its expansion into three high-altitude Chinese wine regions, securing a rare investment in wine production as weak demand forces some competitors to retrench.

The funding comes from Tiansong Construction Group, a privately owned builder based in China’s eastern Zhejiang province, which is taking a stake in one of Ningxia’s largest wine producers. The deal is understood to be part of Xige’s Series A+ financing round.

Xige founder Zhang Yanzhi told Vino Joy News that the money would primarily support winery operations beyond Ningxia and the development of wine tourism offerings. The estate is building three wineries in Deqin in Yunnan province, Derong in Sichuan province and Zuogong in Tibet.

The investment highlights a bet on the long-term value of vineyards and wineries at a difficult moment for China’s wine industry. Producers face weak demand, persistent inventories in distribution channels and shifts in drinking habits. Some have cut investment or withdrawn from wine altogether.

A Construction Company Invests in Wine

Tiansong’s core business is construction. The group reported revenue of RMB 37.521 billion (about US$5.60 billion) in 2025, placing it 346th on the All-China Federation of Industry and Commerce’s 2026 list of China’s Top 500 Private Enterprises.

The company said its investment would support the real economy and create opportunities to share resources with Xige. Despite being announced as a strategic investment, the deal is understood to be financial in nature, with no specific operational collaboration or involvement in Xige’s day-to-day management.

For Xige, it extends a succession of outside investments. In 2022, the estate raised several hundred million yuan in Series A funding from Challenger Venture Capital and Ningxia State-owned Assets Investment Holding Group. CITIC Agricultural Industry Fund Management invested a further tens of millions of yuan in 2023.

Founded in 2017 in the Pigeon Mountain subregion of Qing Tong Xia, at the eastern foothills of Ningxia’s Helan Mountains, Xige now has more than 2,000 hectares of vineyards and produces nearly 10 million bottles of premium wine a year.

Publicly available information ranks it among Ningxia’s leading wineries by sales, tax contributions and exports. Its wines reach more than a dozen overseas markets, including Canada, Australia, Singapore, Japan, Thailand and Hong Kong. By the end of 2025, the estate had paid more than RMB 60 million (US$8.9 million) in cumulative taxes in Qingtongxia.

Expanding Beyond Ningxia

The three new wineries will broaden Xige’s production footprint, giving it access to different growing conditions and wine styles.

The Deqin project in Yunnan has about 53 hectares of vineyards, while Derong in Southwestern Sichuan province has more than 133 hectares and Zuogong in Tibet nearly 333 hectares. Each is substantial by local standards, Zhang said, although all are smaller than Xige’s Ningxia estate.

“The vineyard areas vary from project to project. They may not compare with Ningxia in size, but they are very substantial for their respective regions. We want to build a leading winery in each of these three regions,” he said.

All three projects also include plans for guest accommodation, winery experiences and distinctive landscape features designed to attract visitors.

Such expansion demands funding well beyond the initial construction bill. Vineyards, winemaking facilities and tourism operations require continued investment before they can generate returns. The latest financing gives Xige additional capital to support that development.

A Long-Term Bet in a Weak Market

For investors, backing winery expansion during a wine downturn carries considerable risk. Unlike the relatively asset-light business of trading wine, estates tie up capital in land, vineyards, production facilities and stock.

Zhang sees those physical assets as a source of resilience, arguing that vineyards, wineries and inventories can hold long-term value through market cycles.

“There are successful examples around the world of patient capital investing in vineyards and wineries. I believe China will see the same in the future,” he said.

“From the outset, Xige’s goal has been to build a quality Chinese wine brand. When you are on the right path, people will naturally recognise it, understand it, join you and ultimately support you. I believe this is the direction things are heading.”

Still, securing investment is only one step. Sustained cash flow ultimately depends on consumers buying and drinking the wines, Zhang said.

“We don’t get excited about one or two rounds of financing, because all that money has to be put to work. What we should celebrate is building a brand that consumers truly embrace.”