Radico Khaitan Ltd (RKL) is expected to be a major beneficiary of decline in molasses prices. Molasses comprises of over 20% of its raw material cost and ~8% of its net sales. As per news reports, molasses prices have declined by upto 90% in the past 3-4 months. As per management, the prices may remain lower than its historical average in coming quarters. We have assumed 150-200 bps improvement in EBITDA margins assuming average prices to be at 25-35% lower i.e. ~Rs 250-300 per quintal for next 1-2 years Vs current ~Rs 40 per quintal. Further, price hike received in...