The shares of one of India’s leading liquor manufacturers opened in green on tuesday’s trading session at a price of Rs 1,709.65 per share.
Radico Khaitan Limited is among the oldest and largest manufacturers of IMFL in India. Radico Khaitan manufactures industrial alcohol, Indian Foreign Liquor (IMFL), country liquor, and fertilizers in india. Some of the company’s famous brands include Magic Moments Vodka, 8 PM Premium Black Whisky, Morpheus Super Premium Brandy, Royal Ranthambore, and many more.
The company has established itself as the dominant player in India’s super premium brandy segment, boasting a commanding 64% market share with its flagship brand, Morpheus Super Premium Brandy.
Furthermore, in the fiscal year 2024, the company achieved an impressive volume of 1.3 million cases. This brandy, named after the Greek deity of dreams, Morpheus, is meticulously crafted to cater to discerning brandy enthusiasts, promising a refined, transcendent, and unique experience.
Morpheus Brandy, in addition to its robust performance in the domestic market, is exported to 27 countries worldwide. Looking at the past year, shares of Radico Khaitan Ltd have generated returns of 2% year-to-date and 41% over the past 12 months.
The company’s Jaisalmer Gin, brand dominates with a 50% market share in the premium gin category within India, distributed across approximately 30 countries globally and 22 states within India.
In February 2024, Radico Khaitan Limited introduced ‘Spirit of Victory 1999 Pure Malt Whisky’ at a price of ₹5,000. Initially, the product was launched in the states of Uttar Pradesh and Haryana.
Radico Khaitan operates two cutting-edge distilleries: Rampur Distillery in Uttar Pradesh and Radico NV Distilleries Maharashtra Limited in Aurangabad, Maharashtra. Together, these facilities have a production capacity exceeding 157 million liters and include 28 bottling units.
The company’s Prestige & Above category brands represent 46% of IMFL sales volume and 69% of IMFL sales value. Notably, the Magic Moments brand achieved 6.3 million case sales and surpassed ₹ 1000 Crore in sales value, growing at a rate of 25% over the previous year.
The company commissioned the Sitapur greenfield distillery in Q2FY2024, incurring a capex of Rs. 550 crore for the distillery and Rs. 185 crore for a new bottling line. In FY23-24, the company completed the commissioning of its 350 KLPD distillery at Sitapur.
The company’s revenue experienced a robust 31 percent year-on-year growth, climbing from ₹3,133 crore in FY22-23 to ₹4,119 crore in FY23-24. Concurrently, net profit surged by 25 percent over the same period, rising from ₹204 crore to ₹256 crore.
During the quarter, the company’s Gross Margin stood at 41.0%, slightly below the 41.8% recorded in Q3 FY2024 and marginally above the 40.6% in Q4 FY2023. The year-on-year comparison was impacted by significant foodgrain inflation, leading to a 490 basis points decrease in Gross Margin.
In the December quarter of 2023, the Company invested ₹ 864 Crore in the Rampur Dual Feed and Sitapur Green Field projects. The Company’s net debt increased by Rs 76.1 Cr since March 31, 2023.
The company’s management is concentrating on driving growth in the Prestige & Above (P&A) segment through new product launches and increased marketing investments, aiming to sustain double-digit premium volume growth in FY2025.
Management targets a 15-18% volume growth in the Prestige & Above segment in the short term through new product launches and increased marketing investments. Additionally, they aim to enhance EBIDTA margins to around 18% over the next 3 years from the 14-15% exit rate in FY2024, leveraging operational efficiencies from new capacities and a better product mix.
As of the March quarter of 2024, Marquee Investor Mukul Mahavir Agrawal holds 14,00,83 equity shares, representing a 1.05% stake in the company.
Written by Omkar Chitnis
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.
