Dolat Capital recommended accumulate rating on United Spirits with a target price of Rs 655 in its research report dated July 23, 2019.
Dolat Capital's research report on United Spirits
UNSP’s Q1FY20 revenue grew a weak 5.6% YoY (adjusted). The gross margin also fell 359bps to 46.6%. However, EBITDA/PAT (adjusted) rose 42/98% YoY, due to steep cost control. It is likely to achieve the guided low-teens revenue growth and high teens margin in the medium term. We believe the high barriers to entry, inelastic demand, and perception as a long-term consumption play, together with transformation, through premiumisation, cost control, and de-leveraging, attract investors in UNSP. We believe in this. But, the persistent increase in per unit duties shift wallet share to government and is a structural risk.
Accumulate, with TP of ` 655 @ 40x FY21E standalone EPS, viz. ` 632 plus ` 23 for treasury shares/RCB etc.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.