Earnings Review
Fall in advertising cost helps United Spirits Q2 PAT growth
This story was originally published at 21:04 IST on 30 October 2025
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--United Spirits Jul-Sept net profit INR 4.72 bln
--Analysts saw United Spirits Jul-Sept net profit at INR 3.66 bln
--United Spirits Jul-Sept revenue INR 71.92 bln
--Analysts saw United Spirits Jul-Sept revenue at INR 30.64 bln
--United Spirits Jul-Sept net profit INR 4.72 bln vs INR 3.35 bln year ago
--United Spirits Jul-Sept revenue INR 71.92 bln vs INR 66.71 bln year ago
--United Spirits Apr-Sept net profit INR 7.30 bln vs INR 6.34 bln year ago
--United Spirits Apr-Sept revenue INR 130.15 bln vs INR 125.00 bln year ago
--United Spirits Jul-Sept EBITDA INR 6.72 bln vs INR 5.07 bln year ago
--United Spirits Jul-Sept EBITDA margin 21.2% vs 17.8% year ago
--United Spirits Jul-Sept gross profit margin 47.1% vs 45.2% year ago
--United Spirits Jul-Sept sales volume 16.61 mln cases vs 15.41 mln year ago
--United Spirits Jul-Sept sales volume up 7.7% on year
--United Spirits Q2 prestige and above pdt sales volume 13.91 mln cases
--United Spirits Q2 prestige and above pdt sales volume up 8% on year
--United Spirits Q2 prestige and above net sales INR 28.40 bln, up 12% on yr
By Simran Rede
MUMBAI – A fall in United Spirits' advertising and promotions expenses, which was the highest in 11 quarters, helped boost the bottom line. The company's on-year growth in the bottom line was the highest in six quarters and its top line grew at the fastest pace in three quarters.
A near 8% on-year rise in sales volume aided an almost 12% growth in the company's net sales value, which is a true reflection of the company's top line as it discounts the excise duty. The net sales value for the quarter was INR 31.70 billion, higher than the INR 30.64 billion expected by the Street. The revenue from operations, which includes excise duty, rose nearly 8% on year to INR 71.92 billion.
This growth in the company's net sales was driven by the re-entry in Andhra Pradesh and strong performance of the company's innovation and renovation offerings, the company said.
For the quarter under review, the alcoholic beverages company's net profit rose nearly 41% on year to INR 4.72 billion, with a net profit margin of 14.9%. The gross profit grew over 16% on year and the reported gross margin was 47.1%, implying an expansion of 190 bps from the year-ago quarter.
Previous year's headline pricing flow-through, revenue growth management initiatives, improvement in product mix, and sustained productivity aided the growth in the company's gross profit, it said in a press release. Additionally, relatively stable inflation in the cost of goods sold for major input commodity baskets also helped boost the gross profit, the company said.
The company's earnings before interest, tax, depreciation, and amortisation rose nearly 33% on year to INR 6.72 billion. Moreover, its EBITDA margin expanded 337 bps on year to 21.2%.
During Jul-Sept, the volume of the alcohol maker's prestige and above segment rose 8% on year to nearly 14 million cases with net sales rising over 12% on year. This segment accounted for 89.6% of net sales during the quarter under review, up 70 bps over the same period last year.
Sales volume of popular products, which are priced lower, rose by over 6% on year to 2.70 million cases and it contributed for 8.8% of net sales, implying a contraction of 20 bps on year. The segment's net sales grew 9.2% during the quarter.
At the same time, the company continued to spend rigorously on purchases of stocks-in-trade and raw materials consumed. Expenses arising from purchases of stocks-in-trade rose a sharp 122% on year to INR 4.32 billion and that on raw materials increased over 12% on year to INR 16.37 billion in the September quarter. Other expenses rose nearly 13% on year to INR 4.05 billion, while expenditure on advertising and promotions during the quarter fell over 6% on year to INR 2.41 billion.
Moreover, the company spent another INR 300 million as an exceptional item towards severance costs related to a closed unit under a Supply Agility Programme announced during 2022-23 (Apr-Mar).
For the half year ended September, the company's net profit rose more than 15% on year to INR 7.30 billion and its revenue rose just over 4% on year-on-year basis to INR 130.15 billion. The excise duty for the period fell 0.1% on year to INR 72.96 billion but advertising and promotional expenses jumped nearly 11% on year to INR 4.79 billion.
In Apr-Sept, the sales volume of prestige and above products--the premium and luxury segment--rose 8.5% on year to 26.48 million cases and the sales volume of popular products, which are priced lower, rose 8.7% on year to 5.11 million cases. The prestige and above segment accounted for 89% of net sales value during the first half of FY26, up 60 bps over the same period in the previous year and its net sales increased nearly 11% during this period.
Thursday, shares of the company closed 0.5% higher at INR 1,394.60 on the National Stock Exchange. The company detailed its September quarter earnings after market hours. End
Edited by Akul Nishant Akhoury
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