India’s largest beer manufacturer, renowned for its flagship brands and market dominance, sees a promising horizon ahead. Recent developments in Telangana’s pricing policy, coupled with robust seasonal demand and operational efficiencies, signal potential growth opportunities, while analysts project significant upside potential in the company’s stock performance.
Share Price Movement
The share price of United Breweries Limited went down 1.81 percent to Rs. 2,020 per share on Thursday, a decline from its previous close of Rs. 2,057.30 per share. The market capitalisation now stands at approximately Rs. 53,688 crore as of February 13, 2025.
Q3 Financial Highlights
In Q2FY25, revenue stood at Rs. 2,117 crore, reflecting a 12% YoY growth from Rs. 1,890 crore in Q2FY24 but a 14.5% QoQ decline from Rs. 2,475 crore in Q1FY25. Profit for Q2FY25 came in at Rs. 132 crore, marking a 23.4% YoY increase from Rs. 107 crore in Q2FY24 but a 24.1% QoQ drop from Rs. 174 crore in Q1FY25.
Target By Anand Rathi
Anand Rathi is bullish on United Breweries, recommending a “Buy” rating with a target price of Rs. 2,610, indicating a 30% upside. The optimism is driven by Telangana’s 15% beer price hike, the first since FY20, which contributes 15% of UB’s revenue.
Combined with strong seasonal demand, cost-saving measures, and continuous improvements, this price increase strengthens UB’s outlook. Additionally, Anand Rathi has introduced FY27 estimates and raised the FY26 EPS forecast by 7% to reflect the impact of the price hike.
Competitors
Key competitors in the alcoholic beverages industry include United Spirits Ltd , Radico Khaitan Ltd, Allied Blenders & Distillers Ltd, Tilaknagar Industries Ltd, and Globus Spirits Ltd, each with varying sales and profitability metrics.
United Breweries is currently trading at a P/E of 114, which is above the industry P/E of 33.
Market Outlook
India’s alcoholic beverage industry is set for strong growth, driven by rising global demand. The government plans to boost exports, targeting US $952.9 million in the coming years under the ‘Make in India’ initiative. Despite ranking 40th in global exports, India has significant untapped potential. In 2023-24, exports surpassed US $262.1 million, with key markets in the UAE, Singapore, and Africa. APEDA aims to expand India’s presence in major international destinations, pushing towards a US $1 billion export milestone.
Written By Fazal Ul Vahab C H
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
