Anand Rathi's research report on United Breweries
Market share gains, the lower base (owing to elections) and sustained premiumisation drove an 11% rise in United Breweries’ volumes in Q1 (above the Street’s 5-7% estimate). The operating performance, though, was weak with a 70bp y/y EBITDA margin contraction to 10.9% (12.3%), hit by policy change in Karnataka and higher brand investments. The focus on category growth, capacity addition, innovations (London Pilsner, Amstel, Queenfisher), premiumisation (Heineken Silver) and cost-efficiency steps should help in gradual revenue/margin recovery. We cut our FY26e/FY27e EPS 24/17%. We are optimistic on healthy volume, market-share gain, and gradual margin recovery driving healthy earnings performance.
Outlook
We retain our Buy, with a lower 12-mth Rs2,420 TP, 65x Sep’27e (earlier Rs2,610, 65x FY27e).
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