United Spirits share price hits record high on positive Q1 results; should you buy or hold the liquor stock?

United Spirits share price jumped 6.5% on Wednesday's session to touch a 52-week high following the announcement of healthy Q1FY25 (April–June) earnings by the liquor firm. For the June quarter, United Spirits recorded a rise of 1.7% in consolidated net profit to ₹485 crore on Tuesday. In the same time last year, the business reported a consolidated net profit of ₹477 crore.

Compared to ₹5,808 crore a year earlier, consolidated revenue from operations was ₹6,238 crore in the first quarter of the current fiscal year. According to CEO and Managing Director Hina Nagarajan, the company started FY25 off with a stable first quarter performance.

United Spirits share price today opened at ₹1,356.05 apiece on BSE, the stock touched an intraday high of ₹1,416.85, and an intraday low of ₹1,350. According to Ruchit Jain, Lead Research Analyst at 5paisa, in the last few days, the consolidated above 20 DEMA support and has now resumed its uptrend with high volumes. Hence, traders with existing long positions can continue to ride the trend with a positive bias. The immediate support is now placed around ₹1,300.

The company's Q1FY25 revenue/EBITDA of ₹23.5n/ ₹4.6 billion climbed 8.3%/19% YoY, ahead of Brokerage Nuvama Institutional Equities' estimates, according to the report. 19% EBITDA margins increased 174bp YoY and 589bp QoQ with robust expense reduction. 44.5% gross margins increased 85bp year over year. A&P costs, which accounted for 7.4% of sales, increased 19.2% YoY but decreased 46.3% QoQ.

For a total of ₹2.29 crore and ₹5 crore, the business announced the acquisition of V9 Beverages (15%) and Indie Brews and Spirits (25%). The brokerage will revisit their estimates and target price post the earnings conference call. For now the brokerage maintains ‘HOLD’ rating on the stock.

On the other hand, Motilal Oswal Financial Services said that the Q1FY25 earnings of the liquor firm were in accordance with its forecasts. In 1QFY25, standalone net sales rose 8% YoY while P&A revenue grew by 10% (90% revenue mix). Popular revenue fell 3% year over year as price-sensitive consumers were still impacted by inflation.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.