Radico Khaitan Limited (RKL) is one of the oldest and the largest manufacturers of Indian Made Foreign Liquor in India. Formerly known as Rampur Distillery, RKL commenced its operations in 1943 & over the years, emerged as a major bulk spirits supplier today.
Radico Khaitan earns over 90% of it's revenue from India.
Radico Khaitan earns over 90% of it's revenue from India.
Manufacturing Facilities -
Radico has 2 distilleries- Rampur Distillery in Rampur (Uttar Pradesh) & Radico NV Distilleries Maharashtra Ltd, a joint venture with RNV in Aurangabad (Maharashtra).
Establishing a new facility in Sitapur (U.P)
The company has a total capacity of over 160 million litres & operates 33 bottling units, spread across the country.
Customer Segments -
In IMFL Radico earns (42.2%) from Prestige products, (38.1%) from Regular products & (19.6%) from Non IMFL.
Investment in Building Capabilities -
Radico has invested in augmentation of the grain ENA production at the Rampur distillery & have also decided to set up a 330 KLPD greenfield grain-based distillery in Sitapur.
Financials -
Q1FY22 (YoY)
Rev ₹757.4 Cr vs 597.6 Cr ⬆️27%
PBT ₹77.2 Cr vs 77.6 Cr ⬇️(0.06%)
PAT ₹58.3 Cr vs 59.8 Cr ⬇️(2.6%)
Radico has 2 distilleries- Rampur Distillery in Rampur (Uttar Pradesh) & Radico NV Distilleries Maharashtra Ltd, a joint venture with RNV in Aurangabad (Maharashtra).
Establishing a new facility in Sitapur (U.P)
The company has a total capacity of over 160 million litres & operates 33 bottling units, spread across the country.
Customer Segments -
In IMFL Radico earns (42.2%) from Prestige products, (38.1%) from Regular products & (19.6%) from Non IMFL.
Investment in Building Capabilities -
Radico has invested in augmentation of the grain ENA production at the Rampur distillery & have also decided to set up a 330 KLPD greenfield grain-based distillery in Sitapur.
Financials -
Q1FY22 (YoY)
Rev ₹757.4 Cr vs 597.6 Cr ⬆️27%
PBT ₹77.2 Cr vs 77.6 Cr ⬇️(0.06%)
PAT ₹58.3 Cr vs 59.8 Cr ⬇️(2.6%)
Indian Spirits Industry -
According to Euromonitor International, Indian Made Foreign Liquor (IMFL) volumes are expected to touch 369 million cases in CY2026.
During the CY2022-2026 period, IMFL sales volume is expected to grow at a CAGR of 5.3%.
Indian consumers have become more willing to spend on high-value products, especially premium brands & experiences.
Consumers are experimenting with experiences beyond functional social benefits of alcohol. This trend likely accelerate social acceptance of alcoholic beverages.
Pan India Presence -
Radico Khaitan has a robust sales & distribution network, with over 75,000 retail & 8,000 on-premises shops in key alcohol categories throughout the country.
Radico Khaitan is one of the major supplier of branded IMFL to Canteen stores department in Defence segment.
International Presence -
The company's brands are well recognised and has built a brand equity for itself in international markets.
Radico has presence in 85 International markets, including Middle East, North & South America, Africa, Asia & Europe.
Growth Drivers -
• India’s favourable demographics, growing middle class, rising levels of disposable income, rising acceptance of alcohol will contribute to an increase in alcohol consumption.
• Favourable Excise Policies being developed by several states are expected to improve customer satisfaction.
• New options for Online ordering & home delivery.
• COVID has influenced a change in consumer drinking behaviour, with drinks being more frequently consumed at home
Risks -
• Any policy change by Central/State Govt in areas of production, marketing, taxation, distribution can have an adverse impact on companies performance.
Fundamentals -
Market Cap : ₹ 13,485 Cr
P/E (Stock): 52.64
P/E (Industry): 31
P/B : 6.87
Debt to equity : 0.10
ROE : 13.78%
ROCE : 16.4
EV/EBITDA : 32.9
Conclusion -
India represents one of the largest global
consumption hubs and there is no doubt about the significant growth opportunities that the country presents due its current low per capita consumption, middle class is expanding rapidly.
According to Euromonitor International, Indian Made Foreign Liquor (IMFL) volumes are expected to touch 369 million cases in CY2026.
During the CY2022-2026 period, IMFL sales volume is expected to grow at a CAGR of 5.3%.
Indian consumers have become more willing to spend on high-value products, especially premium brands & experiences.
Consumers are experimenting with experiences beyond functional social benefits of alcohol. This trend likely accelerate social acceptance of alcoholic beverages.
Pan India Presence -
Radico Khaitan has a robust sales & distribution network, with over 75,000 retail & 8,000 on-premises shops in key alcohol categories throughout the country.
Radico Khaitan is one of the major supplier of branded IMFL to Canteen stores department in Defence segment.
International Presence -
The company's brands are well recognised and has built a brand equity for itself in international markets.
Radico has presence in 85 International markets, including Middle East, North & South America, Africa, Asia & Europe.
Growth Drivers -
• India’s favourable demographics, growing middle class, rising levels of disposable income, rising acceptance of alcohol will contribute to an increase in alcohol consumption.
• Favourable Excise Policies being developed by several states are expected to improve customer satisfaction.
• New options for Online ordering & home delivery.
• COVID has influenced a change in consumer drinking behaviour, with drinks being more frequently consumed at home
Risks -
• Any policy change by Central/State Govt in areas of production, marketing, taxation, distribution can have an adverse impact on companies performance.
Fundamentals -
Market Cap : ₹ 13,485 Cr
P/E (Stock): 52.64
P/E (Industry): 31
P/B : 6.87
Debt to equity : 0.10
ROE : 13.78%
ROCE : 16.4
EV/EBITDA : 32.9
Conclusion -
India represents one of the largest global
consumption hubs and there is no doubt about the significant growth opportunities that the country presents due its current low per capita consumption, middle class is expanding rapidly.
