New Research Reports

Radico Khaitan Ltd (RKL) continues to focus on premiumisation and expects double-digit volume growth momentum in the Prestige & Above (P&A) category to continue.

We met Dilip Banthiya, CFO and Saket Somani, SVP - Finance & Strategy. Takeaways, Confident of reporting strong double-digit volume growth in P&A brands driven by expanding product offerings and widening distribution network.

Radico Khaitan is one of the oldest and largest manufacturers of Indian Made Foreign Liquor (IMFL) with net revenue of INR48b and volume of 31m cases in FY25 (P&A was ~15mn cases).

RKL’s Q4FY25 numbers were good, with net revenue growing by 20.9% y-o-y to Rs. 1,304 crore and OPM rising by 225 bps y-o-y to 13.6%, which led to adjusted PAT growth of 59.5% y-o-y to Rs. 91 crore.

United Breweries (UBBL) delivered revenue growth of 9% YoY (est. 10%) in 4QFY25. Volume growth was 5% YoY (est. 8%). The Premium portfolio continued to deliver strong performance, posting 24% YoY growth in 4Q (32% in FY25).

UB will hold share in non-premium, grow in premium. Double digit sales growth and 340bps EBITDA margin expansion between FY25-FY27

Innovation and premiumization success demand a premium

High growth beverage player driven by innovation and premiumization

United Breweries (UBBL) delivered revenue growth of 10% YoY (est. 12%), aided by policy changes in Andhra Pradesh (AP). Volume growth was 8% YoY (est. 6%).

Telangana (15% of UB’s revenue) announced a 15% price hike for beer, marking the first hike since FY20. This and strong seasonal demand (on a lower base), cost-saving steps and consistent capability building efforts augur well for the future.

RKL’s Q3FY25 performance was good with revenue growth of 11.5% y-o-y to Rs. 1,294 crore and OPM rising by 191 bps y-o-y to 14.2%, which led to PAT growth of 27% y-o-y to Rs. 96 crore.

United Spirits (UNSP) reported revenue growth of 15% YoY (est. 13%) in 3QFY25, along with total volume growth of 10% (est. 8%). The Prestige & Above (P&A) segment clocked volume and value growth of 11% and 16%.

We recommend a BUY on the stock with an upside of 10% from the CMP

Som distilleries and breweries holds a ~12% market share of the 190m case strong beer segment in the markets where it operates

We re-iterate a Buy on Radico Khaitan (RKL) with a revised PT of Rs. 2,996. Stock trades at 64x/51x its FY26E/FY27E earnings, respectively. P&A category to post over 15% volume growth in FY2025 driven by focus on premiumisation, while regular category is expected to deliver mid-single-digit volume growth.

Allied Blenders and Distillers (ABD) is well positioned to capture premiumisation trend in alco-beverages industry via new product launches in P&A segment (ICONiQ White Whisky to double its volume YoY in FY25; launches in premium and luxury segments to drive realisation growth).

Radico Khaitan Limited’s (RKL’s) Q2FY2025 numbers were strong beating estimates on all fronts, with net revenues rising by 21% y-o-y and OPM improving 152 bps y-o-y to 14.6%, leading to 33% y-o-y growth in PAT.

We retain a Buy on Radico Khaitan (RKL) with a revised PT of Rs. 2,489. Stock trades at 53x and 42x its FY2026E and FY2027E earnings, respectively.

We attended United Breweries’ first analyst meet and plant visit on Thursday. The former involved a panel discussion and Q&As with senior management, incl. Vivek Gupta (CEO & MD), Vikram Bahl (CMO), Wiggert Deelen (head, supply chain) and Jorn Kirsten (CFO).

MD and CEO Mr. Vivek Gupta, who joined UBBL a year ago, emphasized the need to refocus on consumers, who have been overlooked due to excessive government intervention.