Allied Blenders Share Price Gains 4% After ICICI Securities Initiates Buy Call
ICICI Securities set a target price of Rs 400 apiece on the stock, implying a potential upside of 24%.
Shares of alco-beverage company Allied Blenders and Distillers Ltd., which makes Officer's Choice Whiskey, surged over 4% in early trade on Friday after ICICI Securities initiated a 'buy' call on the company. The brokerage set a target price of Rs 400 apiece, implying a potential upside of 24%.
The largest Indian-owned Indian Made Foreign Liquor manufacturer, as per the report, is charting its path toward premiumisation, backed by robust product innovation and strategic expansions, said ICICI Securities.
Allied Blender's venture into the Prestige & Above category is spearheaded by products like ICONiQ White Whisky, with its annual run-rate projected at 4-5 million cases in this fiscal, said the report. This category is expected to contribute 55% of revenues in the next two years, up from 47% in fiscal 2024.
Officer's Choice Whisky retains a formidable presence with consistent volume in states generating high margins, said the firm.
The company forecasts a 10% compound annual growth rate of revenue and a 30% compound annual growth rate of Ebitda over financial years 2024 to 2027, supported by cost-saving measures like PET conversions and monocarton removals, as per the report.
Regulatory shifts and raw material volatility pose risks, as does the need to sustain momentum in premium and luxury segments amidst competition. However, strategic alliances—such as with Roust Corporation for premium vodka as mentioned in the report—are expected to mitigate these.
The scrip rose as much as 4.90% to Rs 339 apiece, the highest level since Nov. 6, 2024. It pared gains to trade 3.08% higher at Rs 333.10 apiece, as of 09:27 a.m. This compares to a 0.44% advance in the NSE Nifty 50 Index.
It has risen 5.10% on a year-to-date basis. Total traded volume so far in the day stood at 11 times its 30-day average. The relative strength index was at 59.03.
Two analysts tracking the company maintain a 'buy' rating according to Bloomberg data. The average 12-month consensus price target implies an upside of 19.1%.
