Motilal Oswal has issued a buy rating on Radico Khaitan with a target price of ₹4000 in its research report dated May 07, 2026. According to the brokerage's analysis, the company continues to demonstrate robust performance across key metrics, supporting the bullish outlook. The target price is derived by valuing the company at 55x P/E on March 2028E EPS, reflecting confidence in the company's premiumization strategy and execution capabilities.
Radico Khaitan delivered impressive results in Q4FY26/FY26, with revenue growth of 15% YoY at ₹15.0 billion. The company's P&A value growth reached 29%, while the regular portfolio declined 14%. As reported by Motilal Oswal, P&A volumes jumped 28% YoY to 4.4 million cases, exceeding estimates of 4.1 million cases. The regular portfolio volumes declined 10% YoY to approximately 5 million cases due to high base effects and policy changes in Karnataka and Maharashtra. This performance highlights the company's successful strategy to move consumers to premium products, with P&A now making up about 70% of IMFL revenues.
According to Motilal Oswal's analysis, Radico Khaitan is currently trading at 58x/47x FY27E/FY28E P/E ratios. The company is projected to achieve RoE/RoIC of 20%/23% in FY27E. Motilal Oswal believes a ~25% EPS CAGR over FY26-28E provides adequate support for sustaining rich valuations. The target price of ₹4000 is derived by valuing the company at 55x P/E on March 2028E EPS. Competitors like United Spirits trade at a lower P/E of about 56.24x, suggesting Radico Khaitan commands a premium likely because of its focused premiumization strategy and execution.
Non-IMFL revenue demonstrated strong growth of 21% on a low base during the quarter. As reported by Motilal Oswal, royalty cases declined 9% YoY to 0.4 million cases. The brokerage's positive outlook is supported by the company's sustained industry-leading P&A performance and consistent volume growth trajectory across key product categories. Looking ahead, Radico Khaitan expects continued growth with the P&A category projected to grow by about 20% in FY27, with margins expected to expand by 120-125 basis points. The company aims for high-teen EBITDA margins within the next three years. Analysts remain broadly optimistic with a consensus 'Strong Buy' rating from 18 analysts and an average price target of ₹3,560.
