AlcoBev Q3 Results Preview - Dolat Capital Projects Inline Growth; Lists Radico, United Spirits As Top Picks

Dolat Capital Report

We remain positive on AlcoBev companies as long-term earnings compounders driven by a plethora of triggers such as-

1. premiumisation,

2. new product launches,

3. price increases,

4. opening of Andhra Pradesh (likelihood of Bihar too),

5. MRP cut in Karnataka,

6. India-UK FTA,

7. stable/soft raw material etc.

However, higher earnings expectations, stock outperformance and valuations capture this optimism, leaving limited room to err. Moderation in Prestige and Above demand and increased competition in the segment are key risks. Thus, time correction seems inevitable posts the recent run-up/outperformance versus Nifty. Our preferences in the pecking order are Radico Khaitan, United Breweries and United Spirits.

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