United Breweries Q2 Review - On-Trade Channels Gradually Recovering: ICICI Direct

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ICICI Direct Report

United Breweries Ltd.'s performance was below I-direct estimates on profitability. Revenues grew 58% YoY to Rs 1,426 crore, led by volume growth of 49%. Absolute Ebitda came in at Rs 166 crore versus Rs 40 crore in Q2 FY21. PAT came in at Rs 81 crore versus Rs 4 crore in Q2 FY21.

Key triggers for future price performance:

Beer stays an underpenetrated segment (12% market share in alcohol consumed), a preferred choice of ready-to-drink product for the youth and, thus, has long term growth potential (in a landscape historically dominated by liquor).

Newer beer excise regimes (lower excise than liquor) to help in market share gains for the beer sector over the liquor sector.

Strong fundamentals (b/s, cash flow), to help UBL further consolidate its leadership position.

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