United Spirits Limited

Consumer Defensive — Beverages - Wineries & Distilleries · NSE

₹1,380.00−₹1.50 (−0.11%)

DalalBaazaar Score

64 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: Strong business and financial position, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:47 pm

Understanding the Business

Company site ↗

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

What does this company do?

United Spirits Limited, together with its subsidiaries, manufactures, sells, and distributes alcoholic beverages and other allied spirits in India and internationally.

IndustryBeverages - Wineries & Distilleries

SectorConsumer Defensive

Employees2,224

Annual revenue₹12,415 Cr

How does it make money?

Turns over ₹12,415 Cr a year. Of every ₹100 of sales, about ₹15 reaches shareholders as profit, with ₹21 left at the operating level before interest, tax and depreciation. Each of its 2,224 employees supports ₹5.58 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹5.58 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.

Compared side by side in Peers ↓

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 25.5%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 20.5% against a peer median of 51.0% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE51.0%

What is the outlook?

14 analysts covering the stock expect revenue to grow about 12.4% and earnings to grow about 12.3% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+12.4%

Est. earnings growth+12.3%

Analysts14

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +18% while net margin moved +37% 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+18%

Margin effect+37%

DalalBaazaar Score

64/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 58.1x is demanding — it needs sustained high growth to justify
• P/E is close to its own historical median of 67.6x
✗ P/B of 10.94x is a steep premium to book

Quality vs. Valuation

Company Quality

70/ 100

Good

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

Valuation

32/ 100

Expensive

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

A good business, but the price already reflects that. The quality is real; the question is whether you are overpaying for it today.

Historical Valuation

Current P/E

58.1x

3Y Median

67.6x

40 monthly readings · mean 67.3x · range 52.3x–88.3x

Sector Median

43.3x

median of 4 sector peers

🟢Current valuation is approximately 14% below its 3y median of 67.6x. 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 34% above the peer median of 43.3x.

vs. its own history

Fair

67.6x median over 40 months · -14%

vs. sector peers

Expensive

43.3x median of 4 peers · +34%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

37.2x

PEG

3.35

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 13.7% to 21.2% over 3 years.
Cash generation is improving
Free cash flow is up 167% over 3 years.
Return on capital is rising
ROCE has improved from 22.5% to 25.5%.
High return on capital employed
ROCE of 25.5% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 126% over 3 years, from ₹183 Cr to ₹413 Cr.
🔴High leverageFinancial
Debt/Equity of 4.61x — earnings must service borrowings before shareholders see anything.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🟡Receivables growing faster than salesFinancial
Receivables up 48% against revenue up 18% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 25.5% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 13.7% to 21.2%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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?

Leverage amplifies any setback
Debt/Equity of 4.61x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 48% against revenue up 18%. 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 34% above the peer median. That premium needs a reason that persists, or it closes.
Growth barely outpaces inflation
Revenue compounding at 5.6% 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 19%✓ 21.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✓ 5.6% CAGR
Latest reported year was -10.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹1,278 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 22%✓ 25.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 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

5 good · 2 neutral · 4 weak

Market Cap

₹97,988 Cr

Mid Cap

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

P/E (Trailing)

58.1x

Expensive

Expensive — verify against sector peers

P/B Ratio

10.94x

Rich

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

EPS (TTM)

₹23.75

Profitable

Profitable on a per-share basis

ROE

20.5%

Strong

Strong capital efficiency

ROCE

25.5%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

4.61x

High

High leverage

Revenue Growth (YoY)

-10.2%

Shrinking

Sales are contracting

Profit Growth (YoY)

11.2%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.23%

Modest

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

Free Cash Flow

₹1,278 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

45.1x

Improving

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

Operating Margin

13.2%

Average

Average margins

Net Margin

14.9%

Good

Strong bottom-line conversion

Current Ratio

2.05

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.21

Defensive

Steadier than the market

52W Range Position

48%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1377.0 / 1444.4

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

41.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹10,554 Cr	₹11,259 Cr	₹11,517 Cr	₹12,415 Cr	+5.6%
EBITDA	₹1,449 Cr	₹2,144 Cr	₹2,380 Cr	₹2,627 Cr	+21.9%
EBITDA Margin	13.7%	19.0%	20.7%	21.2%	—
PAT (Net Profit)	₹1,137 Cr	₹1,408 Cr	₹1,582 Cr	₹1,838 Cr	+17.4%
EPS	₹16.01	₹19.83	₹22.28	₹25.89	+17.4%
ROE	19.0%	19.8%	19.5%	20.5%	—
ROCE	22.5%	26.3%	26.1%	25.5%	—
Total Debt	₹183 Cr	₹265 Cr	₹480 Cr	₹413 Cr	+31.2%
Free Cash Flow	₹478 Cr	₹1,020 Cr	₹1,785 Cr	₹1,278 Cr	+38.8%

🟢 Revenue has grown at 5.6% a year over 3 years.

🟢 EBITDA has grown at 21.9% a year over 3 years.

🟢 EBITDA Margin has risen from 13.7% to 21.2% over 3 years (+7.4 pts).

🟢 PAT (Net Profit) has grown at 17.4% a year over 3 years.

🟢 EPS has grown at 17.4% a year over 3 years.

🟢 ROE has risen from 19.0% to 20.5% over 3 years (+1.6 pts).

🟢 ROCE has risen from 22.5% to 25.5% over 3 years (+3.0 pts).

🔴 Total Debt has grown at 31.2% a year over 3 years.

🟢 Free Cash Flow has grown at 38.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹14,469 Cr

Total Liabilities

₹5,512 Cr

Cash & Equivalents

₹798 Cr

Operating Cash Flow

₹1,459 Cr

Capex

-₹181 Cr

Shareholding (proxy)

Institutional Holding

24.9%

Insider Holding

59.5%

Corporate Actions

Next Earnings

22 Oct 2026

Dividend Rate

₹17

Ex-Dividend Date

08 Jul 2026

Analyst Consensus

Recommendations

19 Buy · 5 Hold · 1 Sell

Target Price (Mean)

₹1,577.24

+14.3% vs CMP

Target Range

₹1,303 – ₹1,993

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

2 positive4 general

United Spirits discloses DRI search ops; no financial impact reported

scanx.trade, 17 Oct

United Spirits gains 4% in weak market, nears 52-week high; here's why

Business Standard, 24 Jul

Three Days Left To Buy United Spirits Limited (NSE:UNITDSPR) Before The Ex-Dividend Date

Simply Wall Street, 04 JulCapital return

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

Top Midcap Stocks To Buy: Why Expert Sees Up to 67% Upside in HPCL, NALCO, Mazagon Dock, Siemens, More

Goodreturns, 17 Oct

Stock Radar: United Spirits stock bounces back after testing 200-DMA in July 2026; likely to hit fresh rec

The Economic Times, 29 Jul

United Spirits stock gains over 1% after Q1 earnings; Nomura raises target price to Rs 1,600

TradingView, 27 JulAnalyst view

🟢Potentially positiveAn analyst opinion changing, which moves the price without changing the business.

Watch Items

Revenue growth is negative (-10.2%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Profitability

MiddlingFinancial Health · Growth · Risk

WeakValuation

Points for each in the Score ↑

Good business, demanding price

The quality is real and the price already reflects it. Buying here is a bet that the business keeps compounding for long enough to grow into the multiple — which good businesses often do, but it removes the margin for error that a lower price would have given you. 3 high-severity red flags sit above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑