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Analysts Back United Spirits with 'Add' Rating, ₹1,400 Target
Analysts at JM Financial reaffirmed their 'Add' recommendation for United Spirits, setting a target price of ₹1,400 per share. This target suggests potential upside from current trading levels. The brokerage noted softer Q4 revenue performance, largely due to policy changes in Maharashtra and Andhra Pradesh, which contributed to a 5.6% year-on-year decline in overall volumes.
Strong Margins and Growth Prospects Despite Volume Issues
Despite volume challenges, JM Financial highlighted better-than-expected Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) margins. This was supported by gross margin expansion, disciplined cost controls, and management's continued confidence in achieving double-digit medium-term growth. Key growth drivers include ongoing premiumization strategies, favorable policy developments in states like Karnataka, and anticipated benefits from the UK-FTA.
Premium Segment Drives Revenue, Popular Segment Contracts
United Spirits reported a 3.7% year-on-year increase in revenue from operations to ₹3,054 crore for the March quarter. The Prestige & Above segment was a key driver, showing 5% growth. Excluding the impact of Maharashtra and Andhra Pradesh, the company's overall portfolio saw 8.5% growth nationally. However, Net Sales Value (NSV) in the Popular segment contracted by 13.2%, primarily due to the effects of Maharashtra's Modified Liquor (MML) policy.
Dividend Details: ₹11 Per Share Proposed
The company's board has recommended a final dividend of ₹11 per equity share for the financial year ending March 31, 2026. Shareholders eligible for this payout will be determined on the record date, set for Wednesday, July 8, 2026. If approved at the Annual General Meeting (AGM), the dividend payment is expected on or after Thursday, August 13, 2026.
Stock's Technical Picture: Consolidation Expected
From a technical perspective, the stock is trading below its 200-day moving average, currently around the ₹1,360 level. The stock's chart pattern shows weakness, with lower highs and lows suggesting limited upward momentum. Analysts anticipate the stock will likely remain in a consolidation phase between ₹1,250 and ₹1,420 in the near term.