Shares of United Breweriesclosed 4% higher after media reports said that the company has raised Kingfisher beer prices in Mumbai by 7-8%.
In the past 52-weeks, the stock has gained over 42%. Earlier today, the scrip had opened at Rs1114.05 and touched a high and low of Rs1199 and Rs1114.05 respectively.
The promoters holding in the company stood at 73.35% while Institutions and Non-Institutions held 21.33% and 5.32% respectively.
UBL is engaged in the business of manufacture, purchase and sale of alcoholic beverages. The company has network of 21 own breweries and 8 contract breweries across the country. Its flagship brands are Kingfisher Beer and London Pilsner.
The introduction of 3 new brands of Heineken and Kingfisher Storm has received a good initial response in the market.
The Supreme Court order on highway ban of alcohol, which clarified that it does not include retail outlets within Municipal limits, has ensured reopening of many outlets in Q2FY18E. This would lead to continuity in revenue growth momentum with a CAGR of 12% over FY17-19E.
The company is renegotiating procurement prices with the vendors to mitigate margin impact in the absence of input tax credit under GST. Further, on the revival in volumes and price hikes of products, we expect EBITDA margin expansion of 15.5% over FY17-19E. We expect D/E to be stable at 0.2x in FY19E and PAT CAGR of 37% over FY17-19E.
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