United Breweries Limited

Consumer Defensive — Beverages - Brewers · NSE

₹1,200.00−₹3.60 (−0.30%)

DalalBaazaar Score

49 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by negative free cash flow, a very high earnings multiple, which leaves little margin for disappointment, falling profits.

In simple words: Reasonable but unspectacular business quality, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:09 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

The 60-second version of United Breweries Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

United Breweries Limited engages in manufacture, purchase, and sale of beer and non-alcoholic beverages in India and internationally.

IndustryBeverages - Brewers

SectorConsumer Defensive

Employees2,964

Annual revenue₹8,879 Cr

How does it make money?

Turns over ₹8,879 Cr a year. Of every ₹100 of sales, about ₹5 reaches shareholders as profit, with ₹10 left at the operating level before interest, tax and depreciation. Each of its 2,964 employees supports ₹3.00 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin9.5%

Net margin4.7%

Revenue / employee₹3.00 Cr

Who are its competitors?

The closest listed comparisons in its industry are HINDUSTAN UNILEVER LTD., ITC LTD, NESTLE INDIA LIMITED, BRITANNIA INDUSTRIES LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

HINDUSTAN UNILEVER LTD.P/E 42.5x · ROE 21.5%

ITC LTDP/E 16.6x · ROE 27.4%

NESTLE INDIA LIMITEDP/E 59.8x · ROE 79.9%

BRITANNIA INDUSTRIES LTDP/E 44.1x · ROE 51.0%

What is its competitive advantage?Little sign of one

Returns on capital of 13.5% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

ROCE13.5%

ROE9.1%

Peer median ROE51.0%

What is the outlook?

9 analysts covering the stock expect revenue to grow about 10.8% and earnings to grow about 57.5% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+10.8%

Est. earnings growth+57.5%

Analysts9

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +21% while net margin moved +12% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+21%

Margin effect+12%

DalalBaazaar Score

49/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 9.1% is weak

Quality vs. Valuation

Company Quality

48/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

39/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

80.2x

3Y Median

125.8x

40 monthly readings · mean 121.4x · range 74.1x–177.2x

Sector Median

43.3x

median of 4 sector peers

🟢Current valuation is approximately 36% below its 3y median of 125.8x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

⚠️Against its sector it trades 85% above the peer median of 43.3x.

vs. its own history

Cheap

125.8x median over 40 months · -36%

vs. sector peers

Expensive

43.3x median of 4 peers · +85%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

80.2x

P/B

7.02x

EV/EBITDA

38.5x

PEG

7.45

Dividend Yield

0.83%

What's Good / What's Bad

🟢 What's Going Well4

Return on capital is rising
ROCE has improved from 10.5% to 13.5%.
Valuation below its historical average
At 80.2x the stock trades 36% below its own median of 125.8x.
Very low debt
Debt/Equity of 0.29x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention4

Debt is rising
Total debt is up 8328% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.
Receivables growing faster than sales
Receivables are up 109% against revenue growth of 21% — customers are taking longer to pay.
Inventory building faster than sales
Inventory is up 51% against revenue growth of 21% — stock may not be moving.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 8328% over 3 years, from ₹16 Cr to ₹1,317 Cr.
🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴Receivables growing faster than salesFinancial
Receivables up 109% against revenue up 21% — sales are being booked faster than they are collected.
🟡Inventory building faster than salesFinancial
Inventory up 51% against revenue up 21% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 36% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Sales are being booked faster than collected
Receivables are up 109% against revenue up 21%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 85% above the peer median. That premium needs a reason that persists, or it closes.
Growth barely outpaces inflation
Revenue compounding at 6.6% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Several serious flags at once
3 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 8%✓ 9.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹77 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 5% a year✓ 6.6% CAGR
Latest reported year was 7.1%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 1.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 11%✓ 13.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

4 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✗ Profit growing year-over-year
✗ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

2 good · 5 neutral · 4 weak

Market Cap

₹31,729 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

80.2x

Expensive

Expensive — verify against sector peers

P/B Ratio

7.02x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹14.96

Profitable

Profitable on a per-share basis

ROE

9.1%

Moderate

Moderate capital efficiency

ROCE

13.5%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.29x

Low

Conservative leverage

Revenue Growth (YoY)

7.1%

Modest

Modest growth

Profit Growth (YoY)

-9.5%

Falling

Profits are shrinking

Dividend Yield

0.83%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

-₹77 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹1,200

P/E (Forward)

44.2x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

6.4%

Average

Average margins

Net Margin

4.2%

Average

Average bottom-line conversion

Current Ratio

1.24

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.01

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

1204.4 / 1276.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

38.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹7,331 Cr	₹7,876 Cr	₹8,593 Cr	₹8,879 Cr	+6.6%
EBITDA	₹664 Cr	₹769 Cr	₹876 Cr	₹847 Cr	+8.4%
EBITDA Margin	9.1%	9.8%	10.2%	9.5%	—
PAT (Net Profit)	₹304 Cr	₹410 Cr	₹442 Cr	₹413 Cr	+10.8%
EPS	₹11.5	₹15.51	₹16.71	₹15.63	+10.8%
ROE	7.7%	9.8%	10.1%	9.1%	—
ROCE	10.5%	13.2%	13.9%	13.5%	—
Total Debt	₹16 Cr	₹102 Cr	₹620 Cr	₹1,317 Cr	+338.4%
Free Cash Flow	-₹276 Cr	-₹122 Cr	-₹45 Cr	-₹77 Cr	—

🟢 Revenue has grown at 6.6% a year over 3 years.

🟢 EBITDA has grown at 8.4% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 9.5% over 3 years.

🟢 PAT (Net Profit) has grown at 10.8% a year over 3 years.

🟢 EPS has grown at 10.8% a year over 3 years.

🟢 ROE has risen from 7.7% to 9.1% over 3 years (+1.5 pts).

🟢 ROCE has risen from 10.5% to 13.5% over 3 years (+3.0 pts).

🔴 Total Debt has grown at 338.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹9,693 Cr

Total Liabilities

₹5,165 Cr

Total Debt

₹1,317 Cr

Cash & Equivalents

₹460 Cr

Operating Cash Flow

₹435 Cr

Capex

-₹512 Cr

Shareholding (proxy)

Institutional Holding

20.8%

Insider Holding

72.8%

Corporate Actions

Next Earnings

27 Oct 2026

Dividend Rate

₹10

Ex-Dividend Date

07 Aug 2026

Analyst Consensus

Recommendations

6 Buy · 4 Hold · 9 Sell

Target Price (Mean)

₹1,419.16

+18.3% vs CMP

Target Range

₹1,150 – ₹1,765

Peer Comparison

Company	P/E	ROE
HINDUSTAN UNILEVER LTD.	42.5x	21.5%
ITC LTD	16.6x	27.4%
NESTLE INDIA LIMITED	59.8x	79.9%
BRITANNIA INDUSTRIES LTD	44.1x	51.0%

Recent News

1 positive3 mixed2 general

United Breweries Share Price: Technical and Fundamental View

Univest, 13 Oct

United Breweries (BSE:532478) Stock Forecast & Analyst Predictions

Simply Wall Street, 09 OctAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

United Breweries Shares Rises On Resuming Beer Supply To Telangana

NDTV Profit, 17 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

United Breweries shares tumble to 52-week low as Q4 revenue declines amid Middle East conflict; dividend recommended

Upstox, 05 MayCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

United Breweries Ltd Share Price Rise Streak and Valuation

Univest, 14 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Stock Radar: United Breweries stock showing signs of turnaround after falling by about 30% from highs; tim

The Economic Times, 31 Jul

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟡Business QualityAdequate9/20

🟡Financial HealthAdequate12/20

🟡GrowthModest10.4/20

🔴ProfitabilityWeak4.5/15

🔴ValuationDemanding6.7/15

🟡RiskModerate6.4/10

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 3 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 8%9.5%
✗Free cash flow remains positive-₹77 Cr
✓Revenue growth stays above 5% a year6.6% CAGR
✓Debt / EBITDA stays below 2x1.6x
✓ROCE stays above 11%13.5%