United Breweries - Good Q3 Performance; Delayed On-Trade Normalcy An Overhang: Motilal Oswal
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Motilal Oswal Report
United Breweries Ltd. reported 15% YoY decline in volumes in Q3 FY21.On the other hand, rebound from the steep demand trough seen earlier in the year has been better than expected.
We believe on-trade recovery would be gradual, and higher in-home consumption would be witnessed over the next few quarters. This would benefit spirits over beer.
Accordingly, the total revival to normalcy is likely to be delayed for the company.
Given that vaccinating the general population would take over a year, complete on-trade recovery is likely to be delayed. This would in turn delay normalcy in beer consumption well beyond Q1 FY22.
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