During FY17-19, Radico enjoyed an earnings upcycle which is expected to moderate in FY20. However, co is investing in new launches, driving premiumisation and deleveraging B/S which keeps the story alive. Robust cash flow generation over the last 2 years (Rs 4.4bn cumulative FCF) was redeployed to repay debt (Rs 3bn in Jun-19 vs. 7.9bn in Mar-17). We expect deleveraging to sustain, making the co debt free by FY22. We expect the stock to re-rate as premiumisation and deleveraging continues. Radico Khaitans 1Q performance was mixed with beat in volume growth but in-line EBITDA. Hardening of RM cost led to crack in GM margins. Consistent market share gains and scaling new launches drives our revenue upgrade by 6% over FY19-21E. However, sustained RM pressure leads to only 1% EBITDA upgrade over FY19-21E. We value Radico at 26x (35% discount to UNSP) on Mar-21 EPS, arriving at a TP of Rs 492. Maintain BUY.