💰 Financial Performance

Revenue Growth by Segment

Prestige & Above (P&A) segment grew 24% in value and 21.7% in volume in Q2 FY26. The Regular segment returned to growth with a sharp 79.6% volume increase in Q2 FY26 after 9 quarters of degrowth. Overall Net Sales grew 17.8% in FY25 to INR 4,851.2 Cr and 33.8% in Q2 FY26 to INR 1,493.9 Cr.

Geographic Revenue Split

Not disclosed by specific percentage, but the company highlights strong market positions in Uttar Pradesh and significant growth in Andhra Pradesh following the shift to private retail policy.

Profitability Margins

Gross Margin was 43.6% in Q2 FY26. Net Profit (Total Comprehensive Income) margin improved to 9.2% in Q2 FY26 from 7.3% in Q2 FY25. FY25 Net Sales grew 17.8% while Net Profit grew 32.9% to INR 341.2 Cr.

EBITDA Margin

EBITDA margin improved to 15.8% in Q2 FY26 from 14.5% in Q2 FY25, a 130 bps increase. FY25 EBITDA was INR 668.4 Cr, up 31.8% YoY.

Capital Expenditure

Not disclosed in absolute INR Cr for future periods, but the company recently expanded its Sitapur and Rampur distillery platforms to support premium brand growth.

Credit Rating & Borrowing

CARE AA; Stable for long-term bank facilities of INR 1,300 Cr (revised from AA- in June 2024). Short-term rating reaffirmed at CARE A1+ for INR 60 Cr. Finance costs rose 24.8% to INR 73.8 Cr in FY25.

⚙️ Operational Drivers

Raw Materials

Grain and Extra Neutral Alcohol (ENA) represent the primary input costs. Raw materials consumed in FY25 were INR 2,773.9 Cr, representing 57.2% of net revenue.

Import Sources

Primarily domestic sourcing within India, utilizing internal production from 8 distilleries located in states like Uttar Pradesh (Rampur, Sitapur).

Key Suppliers

Not disclosed; company relies on a diverse supplier base to manage price volatility.

Capacity Expansion

Operates 8 distilleries. Internal production of spirit for premium brands provides a strategic margin advantage of INR 6 to INR 9 per liter compared to external procurement.

Raw Material Costs

Raw material costs grew 17.2% YoY to INR 2,773.9 Cr in FY25. Procurement strategy includes maintaining strategic inventory levels to buffer against sudden price hikes in grain and ENA.

Manufacturing Efficiency

Internal sourcing of spirit for premium brands from Sitapur and Rampur distilleries improves margins by INR 6-9 per liter.

Logistics & Distribution

Selling & Distribution expenses were INR 476.5 Cr in FY25, representing 9.8% of net revenue, up 10.1% YoY.

📈 Strategic Growth

Expected Growth Rate

20%

Growth Strategy

Focus on the Prestige & Above (P&A) segment which grew 21.7% in volume in Q2 FY26. Scaling the luxury portfolio (Rampur, Jaisalmer) to reach >INR 500 Cr revenue in FY26 from INR 340 Cr in FY25. Leveraging the new private retail policy in Andhra Pradesh to increase market share. Backward integration in Sitapur/Rampur distilleries provides a cost advantage of INR 6-9 per liter on spirits.

Products & Services

Indian Made Foreign Liquor (IMFL) including Whisky, Vodka, Gin, Brandy, and Single Malts.

Brand Portfolio

8PM Whisky, Magic Moments Vodka, Rampur Indian Single Malt, Jaisalmer Indian Craft Gin, Royal Ranthambore Heritage Collection-Royal Whisky, Sangam World Malt.

New Products/Services

Luxury and semi-luxury segment (Rampur, Jaisalmer, Sangam, Royal Ranthambore) expected to contribute >INR 500 Cr in FY26, representing ~47% growth over FY25's INR 340 Cr.

Market Expansion

Expansion in Andhra Pradesh due to retail policy changes and continued focus on the CSD (Canteen Stores Department) market for premium brands.

Market Share & Ranking

One of India's oldest and largest IMFL companies; Magic Moments holds a dominant position in the vodka segment.

🌍 External Factors

Industry Trends

Accelerating shift toward premiumisation; the luxury segment is growing rapidly from a nascent stage. Volume growth is returning to the regular segment (79.6% in Q2 FY26) after a long period of degrowth.

Competitive Landscape

Increased competition from both domestic and international players due to the high growth potential of the Indian liquor industry.

Competitive Moat

Radico maintains a strong moat through a nationwide distribution network reaching 100,000+ retail outlets. High entry barriers due to complex state-level licensing and 8 owned distilleries ensure supply security and cost leadership (INR 6-9/liter saving).

Macro Economic Sensitivity

Sensitive to grain price inflation and state-level fiscal policies (taxes and levies) which impact consumer pricing and ENA costs.

Consumer Behavior

Expanding consumer base with an increasing propensity to spend more on lifestyle, premium brands, and experiences.

Geopolitical Risks

Not disclosed, though the company is expanding its international business ('Taking India to the World').

⚖️ Regulatory & Governance

Industry Regulations

Highly regulated state-level environment with diverse regional laws, production levies, complex tax structures, and advertising restrictions that can disrupt product movement.

Taxation Policy Impact

Subject to complex state-specific tax structures and production levies which vary significantly across India.

⚠️ Risk Analysis

Key Uncertainties

Regulatory changes in state excise policies and volatility in grain/ENA prices (raw materials are 57.2% of net sales) are the primary business risks.

Geographic Concentration Risk

Significant focus on Uttar Pradesh and Andhra Pradesh as key growth drivers.

Third Party Dependencies

Relies on a diverse supplier base for raw materials, though 8 owned distilleries reduce dependency for premium spirits.

Technology Obsolescence Risk

Focus on manufacturing platform upgrades to improve productivity and product quality.

Credit & Counterparty Risk

Internal financial controls are validated by auditors and certified by the CEO/CFO to ensure reliable financial disclosures.