08-05-2025
I-Sec initiates coverage on United Breweries with Add rating, target price Rs 2,300
United Breweries' key products/revenue segments include Others, Scrap, Other Operating Revenue, Royalty Income, Sale of services and Non-Alcoholic Beverages for the year ending 31-Mar-2024.
Financials
For the quarter ended 31-12-2024, the company has reported a Consolidated Total Income of Rs 2010.40 crore, down -5.49% from last quarter Total Income of Rs 2127.12 crore and up 8.72% from last year same quarter Total Income of Rs 1849.23 crore. The company has reported a net profit after tax of Rs 38.52 Crore in the latest quarter.
The company's top management includes Kripalu, Gupta, A J Van Steenbergen, Cornelis van der Linden, Mazumdar Shaw, Gidwani Verma, Anand, Somasundaram. Company has S R Batliboi & Associates LLP as its auditors. As on 31-03-2025, the company has a total of 26 Crore shares outstanding.
Investment Rationale
ICICI Securities has initiated coverage on United Breweries with an ADD rating and a DCF-based target price of Rs 2,300. The brokerage expects the company to deliver revenue/EBITDA/PAT growth CAGRs of 13%/29%/34% over FY25?27E. They expect recovery in volume growth momentum and United Breweries to deliver an 8.5% CAGR over FY25?27E on the back of higher growth in premium portfolio alongside the company addressing manufacturing capacity constraint and leveraging its superior distribution network. Separately, favourable operating leverage and receding raw material price inflation coupled with price hikes should help United Breweries improve EBITDA margin by 300bps over FY25?27E. Key risks are regulatory changes and RM price inflation.
Promoter/FII Holdings
Promoters held 70.83 per cent stake in the company as of 31-Mar-2025, while FIIs owned 6.92 per cent, DIIs 16.14 per cent. ICICI Securities has an Add call on United Breweries with a target price of Rs 2,300. The current market price of United Breweries is Rs 2127.85. United Breweries, incorporated in 1999, is a Large Cap company with a market cap of Rs 56627.65 crore, operating in Beverages - Alcoholic Breweries' key products/revenue segments include Others, Scrap, Other Operating Revenue, Royalty Income, Sale of services and Non-Alcoholic Beverages for the year ending the quarter ended 31-12-2024, the company has reported a Consolidated Total Income of Rs 2010.40 crore, down -5.49% from last quarter Total Income of Rs 2127.12 crore and up 8.72% from last year same quarter Total Income of Rs 1849.23 crore. The company has reported a net profit after tax of Rs 38.52 Crore in the latest company's top management includes Kripalu, Gupta, A J Van Steenbergen, Cornelis van der Linden, Mazumdar Shaw, Gidwani Verma, Anand, Somasundaram. Company has S R Batliboi & Associates LLP as its auditors. As on 31-03-2025, the company has a total of 26 Crore shares Securities has initiated coverage on United Breweries with an ADD rating and a DCF-based target price of Rs 2,300. The brokerage expects the company to deliver revenue/EBITDA/PAT growth CAGRs of 13%/29%/34% over FY25?27E. They expect recovery in volume growth momentum and United Breweries to deliver an 8.5% CAGR over FY25?27E on the back of higher growth in premium portfolio alongside the company addressing manufacturing capacity constraint and leveraging its superior distribution network. Separately, favourable operating leverage and receding raw material price inflation coupled with price hikes should help United Breweries improve EBITDA margin by 300bps over FY25?27E. Key risks are regulatory changes and RM price held 70.83 per cent stake in the company as of 31-Mar-2025, while FIIs owned 6.92 per cent, DIIs 16.14 per cent.
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