Allied Blenders And Distillers Gets A 'Buy' As ICICI Securities Initiates Coverage, Sees 24% Upside

ICICI Securities Report

Stocks To Buy: We Initiate coverage on Allied Blenders and Distillers Ltd. with Buy with a DCF-based target price of Rs 400.

Allied Blenders and Distillers is well positioned to capture premiumisation trend in alco-beverages industry via new product launches in P&A segment (ICONiQ White Whisky to double its volume YoY in FY25; launches in premium and luxury segments to drive realisation growth).

Further, it has plans to drive profitable growth in Officer’s Choice Whisky by focus on improving state brand mix. Additionally, backward integration towards own ENA manufacturing, premiumisation and operating leverage may drive operating margin expansion (~170 bps over FY25-27E).

We model revenue / Ebitda CAGR of 10%/30% over FY24-27E.

Key risks:

1. Potential ban or regulatory change in key states and

2. failure in scale-up of Prestige & Above segment.

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