Hold Radico Khaitan; target of Rs 1250: Sharekhan

Sharekhan recommended Hold rating on Radico Khaitan with a target price of Rs 1250 in its research report dated May 30, 2023.

Broker Research

June 01, 2023 / 12:55 IST

hold

26 Aug, 2025 12:21

Volume

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Sharekhan's research report on Radico Khaitan

Radico Khaitan Limited’s (RKL’s) Q4FY2023 was affected by dismal performance by regular IMFL segment which registered 23% decline in sales volume and 26% decline in the sales value, resulting in a muted 2.4% growth in revenues lower than our as well as street expectation. Sales volumes of Prestige & Above (P&A) segment grew by 17% in Q4 and 19.5% in FY23 (~38% of overall sales volume). The management is confident of maintaining high teen volume growth in P&A segment in FY24. OPM has bottomed out in Q4FY23. Backward-integration, price hikes undertaken in the key markets (including UP), softening of few commodity prices and a better mix will help EBIDTA margin to improve to mid-teens in FY24 and will consistently improve with a better mix.

Outlook

RKL’s current valuation of 51.2x and 37.5x its FY24E and FY25E earnings provides limited upside. We maintain a Hold recommendation with a revised PT of Rs. 1,250.

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