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Radico Khaitan (RKL) recorded strong operating performance with 50.3% YoY

ICICIdirect Research 29 Jul 2026 DISCLAIMER

News: Radico Khaitan (RKL) recorded strong operating performance with 50.3% YoY EBITDA growth and significant expansion in margins. Net revenues grew 11.8% YoY to Rs.1683.7cr (below our estimate of Rs.1751cr). Prestige & Above sustained its strong growth trajectory with 36% YoY revenue growth to Rs.970cr on a high base, while Regular & Other revenues declined 17.3% YoY. P&A volumes grew 35.9% YoY to 5.2mn cases, while Regular & Other volumes declined 15.1% YoY to 4.6mn cases, resulting in overall IMFL volume growth of 2.8% YoY to 10mn cases. Non-IMFL revenues declined 3.5% YoY to Rs.421cr. Better revenue mix and benign raw material costs aided 610bps YoY expansion in gross margins to 49.1% (beating our estimate of 46%) and 531bps YoY expansion in EBITDA margins to a record-high 20.7% (beating our estimate of 17%), despite a Rs.30cr impact from higher packaging costs, with EBITDA growing 50.3% YoY to Rs.348.9cr. Strong operating performance, coupled with 68% YoY higher other income and 27% YoY lower interest costs, drove 67% YoY growth in adjusted PAT to Rs.229.6cr, beating our estimate of Rs.193cr.

View: RKL’s operating performance was ahead of our estimates. The revenue miss was largely due to lower sales in the Regular & Other segment, impacted by a high base in Q1FY26 and recent policy changes in Maharashtra and Karnataka. The company continued to sustain strong growth momentum in its P&A portfolio despite a high base, driven by Magic Moments Vodka, which reported 3.25mn cases in Q1FY27, up 43% YoY, and has already clocked ~41% of its FY26 volumes in Q1FY27, reflecting strong consumer demand driven by the expansion into new flavoured variants. P&A volume salience improved to 53.2% in Q1FY27 from 41.5% in Q1FY26 (49.6% in Q3FY26), reinforcing the ongoing premiumisation of the portfolio. In light of the improving share of vodka in the Indian IMFL market, consistent growth in whisky, and the company’s strong execution capabilities, the management has revised its P&A volume growth guidance to 25% for FY27 from 20% earlier and has guided for 20% EBITDA margins for FY27.

Impact: Positive

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