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Business News/ Markets / Stock Markets/  Radico Khaitan stock spikes nearly 4% on healthy Q4 earnings
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Radico Khaitan stock spikes nearly 4% on healthy Q4 earnings

Radico Khaitan shares surged nearly 4% to ₹1,670.80 apiece, fueled by strong Q4 and FY24 performance. IMFL revenue grew by 4.3%, while non-IMFL revenue soared by 126.2% YoY.

Radico Khaitan: On the brand performance front, the company demonstrated remarkable growth, selling 6.3 million case volumes of Magic Moments Vodka in FY24, up from 5.2 million in FY2023, with a net sales value surpassing ₹1000 crore. (Photo via Pixabay)Premium
Radico Khaitan: On the brand performance front, the company demonstrated remarkable growth, selling 6.3 million case volumes of Magic Moments Vodka in FY24, up from 5.2 million in FY2023, with a net sales value surpassing 1000 crore. (Photo via Pixabay)

Radico Khaitan, a prominent IMFL (Indian Made Foreign Liquor) brand in India, witnessed nearly a 4% surge in its shares during today's trading session, reaching 1,670.80 per share. Investor enthusiasm was sparked by the company's robust performance in both the fourth quarter and the full fiscal year 2024. 

Revenue from operations (net) increased by 29.7% year-on-year in Q4 to 1,078 crore. While Total Indian Made Foreign Liquor (IMFL) volume declined by 1.2%, Prestige & Above category volume witnessed a notable growth of 14.2%.

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IMFL revenue experienced a YoY growth of 4.3%, reaching 687.5 crore, while non-IMFL segment revenue surged to 391.2 crore, marking a remarkable increase of 126.2% YoY. 

The company anticipates sustaining double-digit premium volume growth in FY2025, attributing the growth in non-IMFL revenue to full capacity utilisation of the Sitapur plant, incremental country liquor volumes from Sitapur, and country liquor price hikes effective April 1, 2023.

During the quarter, the gross margin was reported at 41.0%, compared to 40.6% in Q4 FY2023 and 41.8% in Q3 FY2024. The gross margin was impacted on a year-on-year basis due to significant foodgrain inflation, resulting in a negative impact of 490 basis points (bps) on the gross margin. 

Despite commodity inflation in Extra Neutral Alcohol (ENA) and grain prices, the company managed to sustain gross margin through ongoing premiumisation and price increases in the IMFL business. The company remains committed to making prudent marketing investments in existing core brands and new launches to sustain growth and market share.

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"During Q4 FY2024, A&SP was 7.4% of IMFL sales, compared to 4.5% in Q4 FY2023. On a quarterly basis, the amount may vary, but we expect to maintain A&SP spending around 6% to 8% of our IMFL revenues to be able to drive sales momentum. The company has incurred 891 crore on the Rampur Dual Feed, Sitapur Green Field, and other projects since April 2022," the company said in its investor presentation. 

On the bottom line, the company's net profit improved by 52.4% YoY in Q4 FY24 to 56.8 crore, while it jumped 25.1% YoY to 255.8 crore in FY24. The revenue from operations during FY24 improved by 31% to 4,118.5 crore. Its realisation per case jumped to 1,128 in FY24 from 991 in FY23

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Leading position in the industry

On the brand performance front, the company demonstrated remarkable growth, selling 6.3 million case volumes of Magic Moments Vodka in FY24, up from 5.2 million in FY2023, with a net sales value surpassing 1000 crore. Magic Moments now commands a significant 59% share of the overall vodka market. Additionally, the company strategically launched Magic Moments Remix Pink Vodka to meet the rising demand for colored and flavored alcoholic beverages.

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Meanwhile, the company maintains its market-leading position with a 64% share in the super-premium brandy category in India. In FY2024, the company achieved sales of 1.3 million case volumes of Morpheus Super Premium Brandy, solidifying its dominance in the segment, according to the company's earnings report. 

 

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Published: 15 May 2024, 11:58 AM IST
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