UBL

United Breweries Ltd. (UBL) – Q4 & FY25 Concall Highlights 1. Financial Performance - Q4 FY25: Volume growth +5%; Net sales +9%; EBIT +24% to ₹137 crore. - FY25: Net sales +10%; Gross margin 43% (up YoY). - Premium Portfolio: Grew 24% in Q4, 32% for FY25; now 17–18% of portfolio. 2. Operational Highlights - State Performance: Growth led by Andhra Pradesh, Uttar Pradesh, Maharashtra, and Assam. - Telangana: Suspended supplies in January due to payment delays; 15% price increase in February. - Karnataka: Double-digit volume decline post-duty increases; UBL gaining share. 3. Strategic Initiatives - Premiumization: Targeting 35% premium portfolio share; strong growth from Kingfisher Ultra, Ultra Max, and Heineken Silver. - New Launches: Heineken Silver (localized in Karnataka) and Amstel Grande (launched in Maharashtra, West Bengal, Uttar Pradesh). - Distribution Redesign: Maharashtra model improving next-day delivery; expanding to 4+ states. 4. Capacity & Capex - Greenfield Brewery: Land acquired in U.P.; capacity 1.5–3.5 million hectolitres, completion in 2 years. - Can Line: New canning line in Maharashtra operational by next season. - Cold Chain: Investing in coolers; targeting 50% placement in Maharashtra (from 10–15%). - Capex: Investment rate increasing "in multiples"; no specific guidance provided. 5. Challenges & Risks - Affordability: Major risk post-duty and price increases in Telangana and Karnataka. - Regulatory Volatility: State-level excise changes impacting category growth. - Margin Pressure: Short-term pressure from contract brewing and input cost inflation; medium-term improvement expected. 6. Management Outlook - Optimistic: Confident in premiumization, capacity expansion, and distribution upgrades driving growth. - Execution Focus: Key levers include supply chain improvements, premium brand acceleration, and regulatory engagement.