United Spirits shares fall 4% on Macquarie's "underperform" call amid leadership change

Over the past 1 week, shares of United Spirits declined over 13 percent

Shares of United Spirits fell by more than 4 percent to Rs 1,411 on January 14 following the announcement of a leadership transition as part of its CEO succession plan. Macquarie analysts highlighted that the smoothness of the transition will be closely monitored and assigned an "underperform" rating on the stock, with a target price of Rs 1,175 per share, suggesting a downside potential of 16 percent from current levels.

Hina Nagarajan, who has served as Managing Director and CEO for four successful years, will step down on March 31, 2025, to take on a new role within the Diageo Group. Nagarajan joined United Spirits as CEO-Designate in April 2021 and assumed the role of MD and CEO on July 1, 2021.

The board has appointed Praveen Someshwar as CEO-Designate, effective March 1, 2025. Someshwar will work alongside Nagarajan to ensure a smooth handover and will formally take over as Managing Director and CEO from April 1, 2025, pending regulatory and statutory approvals.

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Someshwar, who has been MD and CEO of HT Media for the past five years, previously enjoyed a successful 24-year career with PepsiCo, where he held various General Management, Finance, and Strategy roles across India and the Asia Pacific region. In 2009, he was appointed CEO of PepsiCo’s South Asia beverage business, and in 2012, he became CEO of PepsiCo India’s foods business.

Elara Capital analysts project 9 percent YoY growth in United Spirits’ P&A volume for Q3FY25E, driven by the festival season and the reopening of Andhra Pradesh.

Over the past 1 week, shares of United Spirits declined over 13 percent, as compared to 2 percent drop in the benchmark Nifty 50 index.

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