Radico Khaitan Q1 Results Review - Inline, Healthy; Gross Margin Expansion Key Trigger: Dolat Capital

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Dolat Capital Report.Radico Khaitan Ltd.’s Q1 FY25 result was in line and healthy. revenue /gross profit/Ebitda/adjusted profit after tax grew by +19/13.5/ 24.6/20.6% YoY.The company is expected to grow strongly over FY24-26E with a CAGR of ~33% driven by-healthy growth in Prestige & Above, especially in Luxury segment,revival of its Popular brand on favourable base,full-year benefit from backward integration (versus H2 in FY24),softening of raw material and financial leverage playing out. .The anticipated raw material softening in FY25/26E could result in a significant earnings delta. However, a potential slowdown in P&A growth is a key risk to earnings which may impact the PE multiple. We reduce our FY25-27E EPS estimates by 11/7/4% to factor in lower gross margin due to persistent raw material inflation. Valuations at 62/47/38 times FY25/26/27E EPS partly capture business optimism, but as growth pans out, we expect earnings to roll forward and stock to re-rate leading to a further price uptick. Radico Khaitan has seen six months of time correction. Gross margin expansion and deleveraging are key triggers. Reiterate ‘Buy’ rating with revised target price of Rs 2,020 at 50 times H1 FY27E EPS (versus Rs 2,150)..Click on the attachment to read the full report:.Radico Khaitan Shares Gain After Q1 Profit Jumps 13%.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Radico Khaitan Q1 Results Review - Inline, Healthy; Gross Margin Expansion Key Trigger: Dolat Capital

Gross margin expansion and deleveraging are key triggers, says the brokerage.

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