1. At a Glance
UBL clocked ₹2,864 Cr in Q1 FY26 revenues—a solid 16% YoY rise, driven by 11% volume growth and 10% EBIT growth. Net profit stood at ₹184 Cr, and the capex buzzed at ₹136 Cr. But is it enough to justify a 115x P/E?
2. Introduction with Hook
Imagine paying ₹2,000+ for a beer stock… that distributes less than 0.5% dividend. That’s United Breweries Ltd (UBL) for you—a literal “high-spirited” business that’s more expensive than the drinks it sells.
- Q1 Sales: ₹2,864 Cr (+16% YoY)
- Q1 Net Profit: ₹184 Cr (+35% QoQ)
- OPM: 11%
- Market Cap: ₹53,798 Cr
UBL is back on tap—but with a frothy valuation, is this beer turning flat?
3. Business Model (WTF Do They Even Do?)
UBL is India’s largest beer manufacturer, and let’s be honest—it owns the taproom.
Main brands:
- Kingfisher Premium
- Kingfisher Ultra & Max
- Heineken (thanks to Dutch overlords)
- London Pilsner, UB Export Lager, etc.
Revenue Sources:
- 99% from beer sales
- Balance from non-alcoholic beverages & exports
Their actual product is brand power + distribution muscle in a heavily regulated, high-excise market.
4. Financials Overview
| Metric | FY25 | FY24 | FY23 |
|---|---|---|---|
| Revenue (₹ Cr) | 8,915 | 8,123 | 7,500 |
| Net Profit (₹ Cr) | 442 | 411 | 305 |
| EPS (₹) | 16.71 | 15.51 | 11.5 |
| OPM (%) | 9% | 9% | 8% |
| ROCE (%) | 14% | 13% | 11% |
Q1 FY26 looks promising:
- Sales: ₹2,864 Cr (vs ₹2,475 Cr QoQ)
- Net Profit: ₹184 Cr (vs ₹132 Cr QoQ)
- EPS: ₹6.95
5. Valuation
Current Price: ₹2,036
EPS (TTM): ₹17.09
P/E: 119x
Book Value: ₹165
P/B: 12.3x
EduInvesting Fair Value Range:
| Method | Estimate (₹) |
|---|---|
| Historical P/E (40x) | ₹685 |
| EV/EBITDA (20x) | ₹1,050 – ₹1,200 |
| DCF (assuming 10% growth) | ₹1,100 – ₹1,300 |
FV Range: ₹1,050 – ₹1,300
At ₹2,036, the stock is clearly partying… but with someone else footing the bill.
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26: 11% volume growth, strong summer demand
- Capex alert: ₹136 Cr spent; expanding capacity
- Legal contingencies disclosed—a brewing concern?
- Investor call commentary: Optimism on margin expansion but cautious on raw material inflation
- Heineken stake: Still strong, brand integration deepening
7. Balance Sheet
| Item | FY25 (₹ Cr) |
|---|---|
| Equity | 26 |
| Reserves | 4,337 |
| Borrowings | 620 |
| Total Liabilities | 8,223 |
| Fixed Assets | 1,749 |
| CWIP | 253 |
| Other Assets | 6,213 |
Key Takeaways:
- Borrowing jumped (₹102 Cr → ₹620 Cr), capex-backed
- Healthy reserves: ₹4,300+ Cr
- Strong asset base; ~75% locked in working capital
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY25 | ₹235 Cr | ₹-239 Cr | ₹217 Cr | ₹213 Cr |
| FY24 | ₹70 Cr | ₹-148 Cr | ₹-122 Cr | ₹-201 Cr |
| FY23 | ₹-120 Cr | ₹-121 Cr | ₹-292 Cr | ₹-533 Cr |
Trend:
Cash flow has finally turned positive in FY25, thanks to better profits and a capex slowdown.
9. Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROE | 11% |
| ROCE | 14% |
| OPM | 9% |
| Working Capital Days | 74 |
| Inventory Days | 327 |
| Debtor Days | 117 |
| Payables Days | 232 |
| CCC | 211 days |
Sexy? Sorta.
Margins are decent but high working capital cycle still drags efficiency.
10. P&L Breakdown – Show Me the Money
| Q1 FY26 | Value (₹ Cr) |
|---|---|
| Sales | 2,864 |
| Expenses | 2,553 |
| Operating Profit | 311 |
| Other Income | 11 |
| Interest | 11 |
| Depreciation | 63 |
| PBT | 248 |
| Tax | ~26% |
| Net Profit | 184 |
Solid quarter. Margins stable, volumes up, and growth broad-based across geographies.
11. Peer Comparison
| Company | CMP | P/E | Sales (Qtr) | ROCE | ROE | PAT (Qtr) |
|---|---|---|---|---|---|---|
| UBL | ₹2,036 | 115 | ₹2,864 Cr | 14% | 11% | ₹184 Cr |
| United Spirits | ₹1,343 | 59 | ₹3,031 Cr | 28.7% | 21.4% | ₹421 Cr |
| Radico Khaitan | ₹2,758 | 107 | ₹1,304 Cr | 16.2% | 13.6% | ₹90 Cr |
| Tilaknagar | ₹470 | 39 | ₹406 Cr | 28.4% | 29.9% | ₹77 Cr |
UBL trades at richest P/E—but lags in ROE and margin metrics.
12. Miscellaneous – Shareholding, Promoters
| Category | Jun 2025 |
|---|---|
| Promoter (Heineken) | 70.84% |
| FII | 6.73% |
| DII | 16.37% |
| Public | 4.92% |
| Govt | 1.16% |
Shareholding is stable. FII/DII slightly trimming positions but still holding faith.
13. EduInvesting Verdict™
United Breweries is back in the groove—volumes are up, margins are up, and Kingfisher is flying high. But here’s the frothy part:
- At 115x earnings, you’re not buying a beer company—you’re buying the entire bar.
- Capex-heavy moves hint at long-term confidence, but legal risk clouds remain.
- In a duopolistic market, UBL is a juggernaut—but you’re already paying for next 5 years of growth.
Verdict:
A high-quality moat business served in a crystal glass… but the price tag might just leave your portfolio tipsy.
Metadata
– Written by Eduinvesting Team | 23 July 2025
– Tags: United Breweries, Q1 FY26, Kingfisher, FMCG, Beer Stocks, Heineken, Capex, Premium Valuation
