ADVERTISEMENT

United Breweries Q1 Review - Better Than Expected; Path To Normalcy To Take Longer: Motilal Oswal

United Breweries Q1 Review - Results Better Than Expected; Path To Normalcy To Take Longer: Motilal Oswal

Unlabelled bottles of beer move along a conveyor belt on the production line at a brewery (Photographer: Waldo Swiegers/Bloomberg)
Unlabelled bottles of beer move along a conveyor belt on the production line at a brewery (Photographer: Waldo Swiegers/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

The lockdown severely impacted Q1 FY22 on-trade sales (usually around 25% of total sales) and home delivery was not permitted in some states throughout the quarter.

Given these factors, United Breweries Ltd.'s results were better than expected, with sales 45% lower than Q1 FY20 sales (up 121% YoY over the low base of Q1 FY21).

Nevertheless, in a capital-intensive business, Ebitda/profit after tax declined 71%/83% versus Q1 FY20 levels.

June 2021 volumes were 50% lower versus June 2019 levels and restrictions on on-trade sales (low working hours, weekend lockdowns, etc.) have persisted in July 2021 in many states.

As a result, the path to normalcy for United Breweries would be gradual, unlike for other discretionary players.

Click on the attachment to read the full report:

Motilal Oswal United Breweries Q1FY22 Result Update.pdf

DISCLAIMER

This report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BloombergQuint.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.