Jefferies Initiates Coverage on India’s Alcoholic Beverages Sector

Jefferies has initiated coverage on the Indian alcoholic beverages industry, highlighting premiumisation as the central growth driver. The brokerage sees the sector delivering double-digit revenue growth over the medium term, supported by rising consumer aspirations, premium brand launches, and improving distribution. Margin expansion opportunities are also significant, given pricing power in premium categories and efficiency gains. Top Picks & Targets:

(TP ₹3,590): Jefferies’ top sector pick, with >35% EPS CAGR expected over FY25–28 and improving RoCEs. (TP ₹1,570): Attractive risk-reward after a ~20% stock correction; EPS CAGR seen at 13% over FY25–28. (TP ₹620): The “dark horse” with meaningful upside, though execution remains the key variable. Broader View: Jefferies believes Indian spirits companies are entering a structural growth phase, driven by premiumisation, margin expansion levers, and better capital efficiency. Disclaimer: This summary is based on Jefferies’ research views. It is provided for informational purposes only and does not constitute investment advice or a recommendation. Investors should consult their financial advisor before making any investment decisions.