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Informist, Friday, Oct. 31, 2025

--United Spirits: Expect Oct-Mar to be challenging for sales 
--CONTEXT: United Spirits mgmt's comments in post-earnings analyst call 
--United Spirits: In very strong position in Andhra Pradesh 
--United Spirits: Want bottom-line growth to be little ahead of topline's 

By Simran Rede and Sagar Sen

MUMBAI/NEW DELHI – United Spirits aims to grow its bottom line slightly faster than its top line growth, though management expects challenges in sales during Oct-Mar. The company believes that the Andhra Pradesh market will continue to drive growth through the second half of the financial year 2025-26 (Apr-Mar), the management said in a post-earnings analyst conference call.

The alcohol manufacturer's net sales for the quarter rose almost 12% year on year to INR 31.70 billion, beating the Street's INR 30.64 billion estimate. This was driven by its re-entry into the Andhra Pradesh market.

However, the company expects the second half of FY26 to be more challenging due to the sharp increase in excise duty imposed by the Maharashtra government. 

For the reporting quarter, the company incurred excise duty of INR 40.22 billion, up 5% year over year.

The company said it is in a very strong position in the Andhra Pradesh market. 

On the demand front, management believes consumer sentiment in urban areas is rebounding with the lowering of goods and services tax rates, which will likely add to consumers' disposable income. This is seen as good for consumption across categories, the company's management said. "... we hope this will propel the October to December festive season demand and thereby convert into healthy category growth and continue to drive overall premiumisation," a top company official said.

Owing to the hike in the excise duty in Maharashtra, the company is cautious about the sales in the state. Under the new liquor policy, Maharashtra has raised taxes on Indian Made Foreign Liquor, which is the backbone of most listed alcoholic beverage manufacturers in the country, to a higher rate of 50-60%.

"Maharashtra will remain a challenge. I want to say that our team has been agile in restructuring the value chain in Maharashtra in complete alignment with our channel partners, therefore making us very competitive," the company official said. Maharashtra contributes 15–16% to United Spirits' total revenue and 13–14% to its prestige and above segment.

To pass on this cost, the company had raised prices by 18–25%. Maharashtra-made liquor hit the market a few weeks ago at INR 160 for a 180 ml bottle. "Consumer acceptance has fuelled volume growth and share gains," the company management said. Since the launch of this Maharashtra-made liquor bottle, it has recorded double-digit growth. "We will be expanding to more markets in the coming quarters," the company said.

The company sees a massive opportunity in the Bihar market. "... if that market were to open, we would, in a very agile manner, capture that opportunity and unlock its potential," the management said. 

For the September quarter, the alcoholic beverages company's net profit rose nearly 41% on year to INR 4.72 billion. Friday, the company's shares closed 2.6% higher at INR 1,431.40 on the National Stock Exchange. The company detailed its September-quarter earnings after the market on Thursday.  End

Edited by Saji George Titus

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