We met Dilip Banthiya, CFO and Saket Somani, SVP - Finance & Strategy. Takeaways: 1) Confident of reporting strong double-digit volume growth in P&A brands driven by expanding product offerings and widening distribution network. 2) Vodka market leadership to be maintained with continuous product innovation (flavoured vodka – now contributing to 65% of brand volume), which also contributes to higher profitability. 3) Radico is gaining share in premium and luxury whisky through new launches such as Royal Ranthambore, Jaisalmer, Sangam, and Morpheus Brandy. Royal Ranthambore’s volume grew 50% in FY25. Radico Khaitan’s (RDCK) recent entry into the premium whisky segment with Morpheus Super Premium Whisky could be a major volume and profitability driver. 4) Margin to improve 100bps every year driven by premiumisation and operating leverage. UK-India FTA trade could further boost profitability. Maintain BUY.
OutlookWe marginally increase our margin estimates driving 1% increase in our EPS estimates. We maintain our BUY recommendation and a DCF-based revised target price of INR 3,050 (previously INR 2,900). We are optimistic about RDCK’s execution capabilities and its ability to identify and launch brands in white spaces, which warrants premium valuation.
For all recommendations report, click hereDisclaimer: 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.
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