United Breweries Q2 Review - Close To The End Of De-Growth Cycle: Dolat Capital
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Dolat Capital Report
United Breweries Ltd.’s Q2 FY22 operating performance was marginally below estimates. Volumes increased by 49% YoY but still down 22% versus pre-Covid-19 levels on account of West and South market.
A modest 60 basis points YoY decline in gross margin is positive in-light of 15% YoY barley inflation.
Post healthy operating performance over FY17-19, United Breweries’ performance had been muted for the last ten quarters. That said, with-
opening of ontrade,
reduction in excise duties in key states (West Bengal, Uttar Pradesh, Rajasthan etc) and
key beer season ahead; United Breweries is well-posed to register a robust volume growth and earnings recovery.
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