01 — At a Glance
The Premium Spirits Play That’s Actually Delivering
- 52-Week High / Low₹3,695 / ₹2,132
- Q3 FY26 Revenue₹1,547 Cr
- Q3 FY26 PAT₹162 Cr
- Q3 EPS₹11.58
- Annualised EPS (Q3×4)₹46.32
- Book Value₹218
- Price to Book12.5x
- Dividend Yield0.14%
- Debt / Equity0.21x
- 3-Month Return-13.8%
The Setup: Radico delivered its highest-ever quarterly revenue (₹1,547 Cr), highest-ever volumes (9.75 mn cases), and highest-ever operating profit (₹267 Cr, or 17.2% OPM). Profit grew 69% YoY. Yet the stock tanked -13.8% in three months. The market’s message is loud: “We love growth, but not at P/E 69.” Luxury brands are working. Route-to-market reforms in Andhra Pradesh flipped market share overnight. But has Radico’s story finally gotten too expensive, or is this the calm before the next leg?
02 — Introduction
The Cinderella Story Nobody Wanted to Admit Was Real
Let’s rewind to 2016. Radico Khaitan was a ₹14 crore profit machine, chugging along at sub-15% margins, with a portfolio that looked like a “regular category” alcohol play. Magic Moments was already there, 8PM was a brand, but the luxury pivot hadn’t even been dreamed of.
Fast forward to March 2025. Profit expanded to ₹345 crore (a 2,461% compound growth). Margins improved from 11% to 14% of revenue. The luxury portfolio alone crossed ₹500 crore in annual sales. Prestige & Above segment went from 42% to 69% of revenue mix. This isn’t incremental. This is a complete business reinvention masked as a quarterly beat.
And then—in December 2025—the company fired its COO, promoted its Chief Sales Officer, and hired a new Chief Marketing Officer. Meanwhile, the board green-lit a 100% Scottish subsidiary to source malt whisky globally. The signal is unmistakable: Radico is no longer just an Indian domestic liquor player. It’s repositioning itself as a global premium spirits house. Whether the market will reward this ambition is an entirely different question, especially at a P/E of 69x.
This is the story of a company that executed flawlessly and then confused itself about whether to slow down or accelerate. Let’s decode Q3, because the next 12–24 months will determine if Radico’s premiumization dream is an empire, or just expensive inventory.
February 2026 Concall Highlight: “This is the inflection point in the sustainability and predictability of our earnings.” — Management. That’s either prescient or the kiss of death. History says overconfidence kills more valuations than underperformance.
03 — Business Model: The Spirits Play
Bottling Premium Dreams at ₹1,597 Per Case
Radico operates three core business streams. One: they distill grain and molasses into Extra Neutral Alcohol (ENA) at four owned distilleries (plus a 36% stake in a JV with another three units). Two: they blend, bottle, and market IMFL (Indian Made Foreign Liquor) under their own brands—8PM, Magic Moments, Rampur Single Malt, Jaisalmer Gin, Contessa Rum, and newer plays like Morpheus and After Dark. Three: they supply to the Canteen Stores Department (CSD)—the defence market—where they hold 20–25% market share and earn premium pricing with zero brand-building costs.
Revenue breakdown is now 49% Prestige & Above (luxury + semi-luxury + super-premium), 19% Regular & Others, and 32% from non-IMFL (rectified spirit, ethanol, contract manufacturing). That 32% is key—it’s the cash cow that funds the 49% luxury experiment.
Distribution is 1+ lakh retail outlets and 10,000+ on-premise locations. The company is now explicitly building out an on-trade (bars, clubs, restaurants) organization because premium brands are built in bars, not liquor shops. This is where volume growth slows but margin expansion accelerates.
Prestige & Above49%Revenue Mix
Regular & Others19%Revenue Mix
Non-IMFL32%Revenue Mix
Realisation₹1,597/Case9M FY25
The Andhra Pradesh Story: On October 1, 2024, Andhra Pradesh implemented excise and route-to-market reforms. What happened next was textbook supply-side destruction for competitors. Radico’s market share jumped from 15% to 26% in 13 months. They became the #1 player in a ₹2.4-crore-monthly market literally overnight. Management expects to hold share and ride category growth—not chase volume. This is the premium spirits thesis in action: distribution wins on reform, not marketing spend.
💬 How many Indian spirit companies actually have the backbone to *not* cut prices when they gain market share? Radico just did. Does your portfolio manager do the same?
04 — Financials Overview
Q3 FY26: The Record Breaker
Result type: Quarterly Results (Q3 FY26) | Q3 EPS: ₹11.58 | Annualised EPS (Q3×4): ₹46.32
| Metric (₹ Cr) |
Q3 FY26
Dec 2025 |
Q3 FY25
Dec 2024 |
Q2 FY26
Sep 2025 |
YoY % |
QoQ % |
| Revenue | 1,547 | 1,294 | 1,506 | +19.5% | +2.7% |
| Operating Profit | 267 | 184 | 232 | +45.1% | +15.1% |
| OPM % | 17.2% | 14.2% | 15.4% | +300 bps | +180 bps |
| PAT | 162 | 96 | 133 | +69.1% | +21.8% |
| EPS (₹) | 11.58 | 7.17 | 9.96 | +61.5% | +16.2% |
The Math Check: Revenue +19.5% YoY. PAT +69.1% YoY. That’s not just leverage—that’s operational excellence on crack. OPM expanded 300 bps YoY (from 14.2% to 17.2%), driven by premiumization mix (+250 bps estimated), raw material softening (~200 bps), and operating leverage. But here’s the rub: Q3 FY25 had exceptional royalty brand performance (lower profitability, outsourced distribution). The base-year comparison is favorable. Strip that out, and you’ve got solid 200–250 bps of structural margin improvement. Still excellent. But not 300 bps every quarter.
05 — Valuation: Fair Value Range
Is 69x P/E the New ‘Reasonable’?
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