The net profits of Kweichow Moutai Co., a leading high-end liquor producer, rose 21 percent year on year to reach 3.59 billion yuan (574.4 million U.S. dollars) in the first quarter of 2013.

The growth rate was far less than the 42.54-percent rise recorded in the same period last year, according to the firm's report filed to the Shanghai Stock Exchange on Wednesday.

The report said prepayments by the company's distributors shrank in the first quarter. The balance for advance payments stood at 2.87 billion yuan at the end of March, a sharp decline from 5.09 billion yuan at the end of 2012.

The decline was caused by a frugality campaign launched by the Chinese government in December that prohibits officials and military officers from engaging in extravagant behavior, analysts said.

Liquor makers have traditionally relied heavily on government receptions and business banquets for revenue.

Kweichow Moutai's shares rose 3.08 percent on Wednesday to reach 178.49 yuan per share amid sagging stock indices for the country's A shares.