Radico Khaitan shares have climbed 56% in six months, outperforming peers like United Spirits, driven by a strong shift toward premium liquor products. The company’s Prestige & Above category now accounts for 70% of its revenue, leading management to upgrade its growth guidance for the 2027 fiscal year.
Radico Khaitan has emerged as a standout performer in the Indian alcoholic beverage sector, with its stock price recording a 56% increase over the last six months. This growth trajectory significantly outpaces competitors, as United Spirits saw a 12% rise and United Breweries recorded a 2% decline during the same period. The company's focus on higher-value products is central to this trend, drawing increased interest from domestic institutional investors who raised their stake to 28.08% by the end of June 2026.
Premium Products Drive Revenue Gains
The company's business strategy centers on its Prestige & Above portfolio, which includes brands like Magic Moments vodka and its premium single malt offerings. This segment has become the primary driver for the company, contributing approximately 70% of its total revenue and half of its total sales volume. In the first quarter of the 2027 fiscal year, the company reported total sales of 10 million cases. Within this, the Prestige & Above category saw a sharp volume growth of 35.8%, reaching 5.22 million cases, which allowed the company to outpace major industry rivals.
Margin Management and Debt Reduction
Despite rising costs for raw materials, Radico Khaitan successfully improved its gross margins on a quarter-on-quarter basis. This success is largely attributed to a better product mix, as the company sells more expensive items, and favorable pricing for Extra Neutral Alcohol, a key ingredient in liquor production. Furthermore, the company’s financial health is benefiting from a clear focus on deleveraging. Management has communicated a near-term goal of becoming net debt-free, which has been well-received by the market.
Looking ahead, the management has increased its growth forecast for the Prestige & Above segment for the 2027 fiscal year, now expecting growth of over 25% compared to the earlier projection of 20%. The company also aims to maintain an EBITDA margin—a key measure of operating profitability—around 20%.
Investors will continue to monitor how the company balances its aggressive expansion in premium categories with its goal of reducing debt. Key monitorables for the coming quarters will be the sustainability of these margins amid potential fluctuations in raw material prices and the company’s ability to maintain its volume growth momentum in the competitive Indian liquor market.