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Radico Khaitan Q3 results boosted by luxury brands
Radico Khaitan, one of India’s largest liquor companies, has reported a 27% rise in third-quarter profits thanks in part to success in its premium segment.
India’s Radico Khaitan, the country’s fourth largest liquor company, reported on Wednesday that its Q3 profit was up by more than a quarter, helped by strong festive season demand for premium spirits.
The company reported a consolidated net profit of INR954.9 million (£8.87m) for the three months ended 31 December, up from INR751.5m a year ago.
Revenue from operations rose 7.2% to INR44.41 billion.
Radico Khaitan has increased its focus on brands in its premium segment. Revenue grew 24.7% for the company’s premium segment in the third quarter, significantly higher than the 15% revenue growth for the regular segment.
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Radico is investing heavily in its premium brands. Its luxury spirits portfolio includes Indian whisky Rampur and Jaisalmer Indian Craft Gin. The company is valued at INR293.96bn.
The company is shifting its focus towards the higher end, and the share of its premium brands has increased over the last few quarters. According to Reuters, the shift has helped to shield the company’s bottom line from inflationary pressures on demand.
In September Radico Khaitan launched the next two whiskies in the Rampur Jugalbandi series of eight cask strength Indian single malt whiskies.
Changing liquor policies in some Indian states have also boosted demand. Karnataka, a state in southwest India whose capital is Bengaluru (formerly Bangalore), has reduced taxes on premium alcohol. The state has introduced steep hikes in excise duties for beer, with cheaper brands worst affected. The heavier beer tax could positively impact spirits businesses as rising beer costs have the potential to shift consumers to other categories.
Andhra Pradesh, a state on the east coast of southern India, has allowed private retailers to sell spirits, which has also boosted demand for the category.
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