Radico Khaitan (RADICO) Q1 24/25 earnings summary

Executive summary

• Achieved strong premium volume growth in Q1 FY25 despite challenging market conditions, with Prestige & Above brands driving performance and value growth of 19%.

• Launched four new luxury brands in India, including Rampur Asava, Sangam World Malt, and Jaisalmer Gold Edition, expanding the premium portfolio.

• Magic Moments Vodka recorded 1.9 million cases sold in Q1 FY25, maintaining its position as the sixth-largest vodka brand globally and holding 60% of the vodka market share.

• Focus remains on premiumization, brand innovation, and expanding distribution, including partnerships such as the exclusive alcoholic beverage partner for India House at the Paris 2024 Olympics.

• Unaudited standalone and consolidated financial results for the quarter ended June 30, 2024, were approved by the Board on August 7, 2024.

Financial highlights

• Revenue from operations for Q1 FY25 was ₹426,562.35 lakhs (consolidated), up from ₹390,894.11 lakhs year-over-year; net sales for Prestige & Above brands grew 19.1% to ₹499.5 Cr.

• IMFL volume for Q1 FY25 was 7.07 million cases, a 4% year-over-year decline, mainly due to strategic rationalization and state-specific excise issues.

• EBITDA increased 24.6% year-over-year to ₹148.2 Cr, with a margin of 13.0%.

• Gross margin was 41.5%, down from 43.6% in Q1 FY24, impacted by crude grain inflation, but stable sequentially due to premiumization and price increases.

• Consolidated net profit for Q1 FY25 was ₹6,826.88 lakhs, compared to ₹6,780.06 lakhs in Q1 FY24.

Outlook and guidance

• Management expects continued double-digit premium volume growth for FY2025 and stable raw material costs supporting margin expansion.

• Maintain guidance for 15-16% margins by FY26.

• Price increases for the year expected to remain between 150-170 basis points.

• Maintenance CapEx to be INR 70-80 crore annually post-FY25, with INR 150 crore in FY25 due to project completion.

• Commitment to be almost debt free by FY26, with focus on returning cash to shareholders thereafter.