(Reuters) – India’s United Breweries reported a rise in second-quarter profit on Thursday, driven by higher demand for its small, but fast-growing premium beers.
The Kingfisher beer manufacturer’s standalone profit jumped 23% to 1.32 billion rupees (nearly $16 million) for the three months to Sept. 30.
The brewer, which is majority-owned by Netherlands-based Heineken, reported a 13% rise in quarterly revenue to 47.42 billion rupees.
KEY CONTEXT
Urban consumers with higher disposable incomes are looking to indulge in more premium alcohol, prompting companies to step up their offerings.
United Breweries’ more premium beers, which include London Pilsner and Heineken Silver, have outpaced the growth of its cheaper beverages, helping boost its revenue and margins.
Rival Radico Khaitan also reported a higher second-quarter profit on increasing demand for premium alcohol.
PEER COMPARISON
Estimates (next Analysts’ sentiment
12 months)
RIC PE EV/EBI Revenue Profit Mean # of Stock to Div
TDA growth growth rating analysts price yield
(%) (%) * target** (%)
United 69.50 44.01 13.60 43.77 Hold 13 0.97 0.52
Breweries Ltd
United Spirits 64.24 43.43 10.09 13.47 Buy 10 1.02 0.61
Ltd
Radico Khaitan 69.05 40.77 13.65 37.38 Strong 6 1.11 0.14
Ltd Buy
Tilaknagar 30.90 21.87 -21.89 11.00 Strong 1 0.87 0.18
Industries Ltd Buy
* Mean of analysts’ ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** Ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
JULY TO SEPTEMBER STOCK PERFORMANCE
— All data from LSEG
— $1 = 84.0460 Indian rupees
(Reporting by Kashish Tandon in Bengaluru; Editing by Sonia Cheema)
