08-05-2025
United Breweries plans significant capex increase to boost production capacity
United Breweries
Ltd (UBL) is going to push more
capex investment
this fiscal to increase its
production capacity
and availability of coolers in retail outlets across the country, managing director and chief executive officer Vivek Gupta said.
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Talking to analysts in their fourth quarter earnings call on Thursday, Gupta said the country's largest beer brewer has plans to increase its cooler installation from the current 10-15% in Maharashtra to 50% in the next couple of years.
He, however, declined to share the capex figure for 2025-26. UBL had a capex of Rs 254 crore in 2024-25, up by Rs 64 crore from last year which was used in commercial and supply chain initiatives to drive future growth.
UBL, however, is under pressure in the South. In Telangana, beer prices were increased by 15% in February following the state and United Breweries spat over undue payments by the former to the latter. Karnataka, last week increased tax on the manufacturing cost of beer to 205%, from the earlier 195%, thereby impacting the MRP of both mass and premium brands.
'A lot of work has gone into this quarter. Our inventory was higher, despite the disruption, we are in the middle of the season, we feel confident. The worry part is the increase in duty. We saw the impact of that in Telangana and Karnataka. Duty is posing to be the biggest threat,' said Gupta.
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The South volume growth of 5% last quarter for UBL was driven by Andhra Pradesh, which was impacted by the decline in Telangana and Karnataka.
The company's standalone revenue for the fourth quarter ending March declined by 8% year-on-year (yoy) at Rs 4,425.5 crore as on March 31st, 2025. The net profit grew by 20.5% yoy at Rs 97 crore.
For 2024-25, UBL sales grew by 5.6% yoy to reach Rs19,400.8 crore and net profit by 7.8% yoy at Rs 441 crore. Last quarter, the Kingfisher beer maker posted 5% overall volume growth and 24% volume growth for its premium portfolio.
'We see strong growth from Kingfisher Ultra, Kingfisher Ultra Max and Heineken Silver and we continue to drive premium volume growth. After receiving an overwhelming response in Maharashtra and West Bengal, we also introduced Amstel Grande in Uttar Pradesh, a vibrant market with a growing demand for premium beverages," the company said in its earnings report.
On Thursday, United Breweries' shares closed at Rs 2,159 on the BSE, down 1.05%.
