Shares of a leading beverage alcohol company in India notched 6.87 percent gains on Friday’s early trades to reach an intraday high of ₹ 1042.00 apiece on the National Stock Exchange (NSE) after the company reported stellar results for the first quarter of the financial year 2023-24 (Q1FY24).
On a consolidated basis, United Spirits’ profit marched 82.57 percent higher at ₹ 476.7 crores in Q1FY24 (April to June 2023) as compared to ₹ 261.1 crores in the corresponding quarter of the previous year. However, its revenue from operations declined by 18.55 percent to ₹ 5,830.10 crores in the latest quarter as compared to ₹ 7,157.50 crores in the same quarter last year.
Its net sales value came in at ₹ 2668 crores and EBITDA at ₹ 714 crores, up 28.6 percent and 129.4 percent respectively, based on prior year comparators.
“We have commenced fiscal 2024 with a robust first quarter performance. While inflationary pressures remain, our strategy to reshape the portfolio combined with revenue growth management and focus on everyday efficiency is driving sustainable growth across the Prestige & Above segment,” said Hina Nagarajan, CEO & Managing Director, United Spirits.
United Spirits is among India’s leading alcoholic beverage companies and a subsidiary of global leader Diageo PLC. It manufactures, sells, and distributes premium brands such as Johnnie Walker, Black Dog, Black & White, VAT 69, Antiquity, Signature, Royal Challenge, McDowell’s No.1, Smirnoff and Captain Morgan.
With a market capitalization of ₹ 70,920 crores, United Spirits is a large-cap company. It has an ideal return on equity of 20.75 percent and an ideal debt-to-equity ratio of 0.03. Its shares were trading at a price-to-earnings ratio (P/E) of 60.85 which is higher than the industry P/E of 28.59, indicating that the stock might be overvalued as compared to its peers.
The company’s promoters hold a 56.68 percent stake in the company, followed by retail investors with 16.26 percent, foreign institutions with 15.92 percent, mutual funds with 10.07 percent and other cosmetic institutions with 1.07 percent.
Written by Simran Bafna
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