United Breweries, as the market leader with nearly half of the country's beer volumes, is best placed to capture this multi-year growth cycle. With distribution infrastructure scaling up, consumer demand tilting toward premium brands, and peers struggling to regain momentum, Nirmal Bang believe United Breweries' growth story is shifting from cyclical recovery to structural compounding.
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Nirmal Bang Report
United Breweries Ltd. is no longer just a cyclical recovery candidate. The industry is undergoing a structural transformation, and United Breweries is positioned at the center of this change.
Favorable policy reforms are creating a more stable operating environment. A younger generation of consumers is reshaping the demand landscape with higher frequency and premium inclination. Distribution expansion through visi coolers is unlocking the next wave of retail-driven growth.
Peers are either stagnating or losing ground, reinforcing United Breweries' dominance. And finally, premiumization backed by new launches is strengthening brand equity and eventually expanding margins in medium term.
Five structural catalysts powering United Breweries' next phase of growth
Policy support is creating a more conducive environment for sustained growth.
Younger generations are reshaping the demand curve in favor of beer and premium products.
Visi cooler expansion is unlocking a new wave of distribution-led growth.
Peers are losing ground while United Breweries consolidates its leadership.
Premiumization and new launches are widening margins and strengthening the brand.
The stock trades at inexpensive valuations of ~35x FY27E EV/Ebitda. We maintain our target multiple of 40x, rolling forward to Sep-27E EV/Ebitda (~28%/18% discount to the 3/5-year average one-year forward multiples) and derive a target price of Rs 2,250.
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