United Spirits delivered exceptional Q1FY27 results that significantly boosted investor confidence, with the stock trading 1.52% higher at ₹1,489.50 following the earnings announcement. The company reported a 51.6% year-on-year increase in net profit to ₹391 crore, substantially beating the CNBC-TV18 poll estimate of ₹316 crore. Revenue from operations rose 6% YoY to ₹2,703 crore from ₹2,549 crore, also surpassing the poll estimate of ₹2,662 crore. This strong performance has prompted Nomura to retain its ''Buy'' rating while raising the target price to ₹1,600 from ₹1,500, citing regulatory tailwinds and improving premiumisation trends.
According to The Economic Times, United Spirits stock has bounced back after consolidating in a narrow range in July 2026, taking support above the long-term moving average which suggests bulls are not ready to give up. Medium term traders can look to buy the stock for a target of ₹1,700 in the next 2-3 months, with experts suggesting a strict stop loss at ₹1,270 for this investment. The technical indicators like moving averages and RSI confirm a sustained uptrend, with the stock benefiting from premiumisation trends and potential trade agreements with the UK.
The Prestige & Above (P&A) segment showed mixed results with revenues growing 10.1% YoY despite a 1.3% volume decline, supported by premiumisation trends. According to Nomura, ex-Maharashtra, P&A volumes and sales grew 6.4% and 14.8% YoY respectively, indicating strong momentum across the rest of the country. The brokerage notes that Karnataka's excise policy change effective May 2026 resulted in a 10-15% price reduction in P&A, creating a structural tailwind for premiumisation with consumers likely to trade up and drive strong volume growth of 15%+. The Popular segment volumes will remain under pressure due to tax/price hikes in Karnataka.
The Popular segment faced significant headwinds with 14% and 18% volume and revenue contraction YoY due to regulatory changes including the Maharashtra MML and Karnataka policy modifications. However, Nomura expects margin recovery to remain gradual driven by elevated glass and PET packaging costs. The brokerage anticipates that margin benefits from the India-UK FTA will be seen in volumes for BIO and margins for BII from October 2026, considering inventory of 60-70 days in the distribution channel. Management has guided advertising and promotion spending at 10.5-11% of sales for FY27, compared with 11.5% in Q1, supported by productivity initiatives and premiumisation.
According to Nomura, the company has maintained its FY27 guidance of double-digit sales growth with P&A volume growth of 5-6% and 6-7% price-mix growth, while operating profit margin is expected to remain in the 'mid-to-high teens with profit growth ahead of sales growth'. The brokerage has revised its volume CAGR forecast to 4.4% over FY26–FY29E while maintaining a revenue CAGR of 11.0% over the same period. Following the quarterly performance, Nomura increased its FY27-29 earnings per share estimates by around 3% to reflect better margin guidance, with benefits from the India-UK FTA expected to materialise from the third quarter onward as regulatory tailwinds begin to materialise.
