BENGALURU (Reuters) – Indian alcohol beverage maker Radico Khaitan Ltd on Thursday reported a 15% fall in fourth-quarter profit, hurt by soaring input costs.
The maker of Magic Moments brand of vodka said their consolidated net profit fell to 426.5 million rupees ($5.15 million) for the quarter ended March 31, from 501.6 million rupees a year ago.
Revenue from operations rose 4.7% to 33.75 billion rupees. However, input costs spiked by nearly 14%, pushing total expenses up 5%.
Radico, based in the northern state of Uttar Pradesh, declared a dividend of 3 rupees per share.
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WHY IT MATTERS
India’s alcohol and beverage industry has been battling high raw material inflation, with prices of extra neutral alcohol (ENA) and rectified spirit, primary raw materials needed to make alcoholic beverages, inching up every quarter.
Bottle prices also spiked due to inflation in natural gas and soda ash required for glass production.
Radico was further hurt by a 5.5% rise in excise duty costs, an expense that hurt its peers United Breweries and Sula Vineyards as well.
PEERS COMPARISON
Valuation (next 12 Estimates Analysts
months) (next 12 ‘
months) sentimen
t
RIC PE EV/EBI Price/ Revenue Profit Mean # of Stock to Div
TDA Sales growth growth rating* analyst price yield
s target** (%)
Radico Khaitan Ltd RADC. 45.03 26.79 NULL 15.28 43.42 Hold 7 1.01 0.26
NS
United Breweries UBBW. 56.90 34.37 NULL 11.22 51.23 Hold 13 0.94 0.74
Ltd NS
United Spirits Ltd UNSP. 51.72 33.33 NULL 5.61 16.57 Hold 16 0.96 NULL
NS
Sula Vineyards Ltd SULA. 36.80 19.33 NULL 10.25 NULL Strong 1 0.88 1.29
NS Buy
** The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
($1 = 82.74 Indian rupees)
(Reporting by Biplob Kumar Das in Bengaluru; Editing by Janane Venkatraman)