Jefferies backs Indian liquor stocks; Radico Khaitan top pick with Rs 4,500 target
Jefferies favours Indian alcoholic beverage names, tagging Radico Khaitan its top pick (TP Rs 4,500) with a buy on Allied Blenders (Rs 780, 25% upside) and a hold on United Spirits (Rs 1,560, 13% upside). Premiumisation, young demographics and the UK-India FTA seen powering 30% earnings CAGR and 12% P&A volume growth.
What happened
Jefferies favors Indian liquor stocks, naming Radico Khaitan top pick (TP Rs 4500), buy on Allied Blenders (Rs 780), hold on United Spirits (Rs 1560).
Key facts
- Radico TP Rs 4500
- Allied Blenders TP Rs 780 (25% upside)
- United Spirits TP Rs 1560 (13% upside)
- 30% earnings CAGR FY23-FY26
- P&A 12% volume growth
- premium 40% of sector profits
Why this matters
The UK-India FTA tailwind and premiumisation thesis make premium-spirits assets and Scotch/imported portfolios attractive M&A and JV targets to capture the structural earnings ramp.
What to watch
- Quarterly P&A volume growth vs 12% guidance
- UK-India FTA scotch duty implementation timeline
- State excise policy changes (Maharashtra, Karnataka, UP)
- ENA and glass input cost trends; gross margin trajectory
- Other brokers initiating/upgrading the alco-bev space
- Radico Khaitan rallies toward Rs 4,500 with elevated volumes near-term
- Allied Blenders draws fresh institutional buying on 25% upside call
- Sector peers (Tilaknagar, Globus Spirits) catch sympathy bid
- United Spirits underperforms peers given hold rating and lower upside