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. Premiumisation and cost optimization to aid 125-150 bps annual OPM improvement over the next 2-3 years. Targets late-teens OPM in three years. With strategies in place, we expect RKL’s revenues and PAT to post an 18% and 39% CAGR, respectively, over FY2024-27. Strong earnings growth and reduction in debt will boost return profile in the coming years.
OutlookWe 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.
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