United Spirits Limited Q4 First Take: Margin-led earnings beat; constructive FY27 outlook

Research evidence excerpt

United Spirits Limited Q4 First Take: Margin-led earnings beat; constructive FY27 outlook

Latika Chopra, CFA AC Asia Pacific Equity Research

(91-22) 6157-3584 14 May 2026 J P M O R G A N

latika.chopra@jpmorgan.com

Investment Thesis, Valuation and Risks

United Spirits Limited (Overweight; Price Target: Rs1,445.00)

Investment Thesis

USL is a structural play on the Indian liquor space, which we think has attractive long-term

growth prospects, led by favourable demographics, low per-capita consumption and

significant benefits from premiumization. USL enjoys a strong portfolio of brands

(supported further by Diageo’s brands), and a focused strategy towards profitability. We

believe many of the positives (premiumization, innovation/renovation efforts, cost-saving

initiatives) hold it in good stead over the medium term. We have growing confidence in

higher earnings growth delivery backed by a healthy growth trajectory for the Prestige &

Above portfolio and better-than-anticipated margin delivery. Favorable regulatory

outcomes in select states (Andhra Pradesh re-opening, doubling of retail outlet reach in UP,

better excise policy to drive premium salience in MP, privatization of retail in Jharkhand)

should be accretive to growth in coming quarters. Furthermore, in FY27 we anticipate a

significant uptick to BIO/BII sales from the recently revised import duty per UK FTA

agreement. Overweight.

Valuation

Our Mar-27 target price is Rs1,445, based on a one-year forward 32x EV/EBITDA multiple

for the standalone business. This reflects a 10% discount to the historical average multiple

to account for revenue growth volatility due to regulatory changes, and includes ~Rs195 per

share (post tax) value from the sale of Royal Challengers Sports.

Risks to Rating and Price Target