United Spirits Soars as Foreign Broker Turns Bullish: Target Price Hiked to Rs 1,760

Introduction: A Major Boost for Diageo-Owned Liquor Giant

Shares of United Spirits Ltd (USL), India’s leading alcoholic beverage company, surged 6.5% in early trade today after global brokerage firm Jefferies upgraded its rating and raised the target price to ₹1,760 per share—a 20% upside from current levels.

This bullish call comes amid strong demand recovery, premiumization trends, and margin expansion in the Indian Made Foreign Liquor (IMFL) segment.

In this blog, we break down:
Why Jefferies turned bullish on United Spirits
Key financial upgrades and growth triggers
How USL compares with rivals like Pernod Ricard
Stock performance & investor outlook

Why Did Jefferies Raise United Spirits’ Target to ₹1,760?

1. Premium Portfolio Driving Growth

USL’s premium brands (McDowell’s No.1, Signature, Antiquity Blue) are growing at 12% YoY, outpacing the industry.
Premiumization trend in India favors high-margin products.

2. Market Share Gains in Key States

Karnataka, Maharashtra, and Delhi show strong volume recovery.
Gaining share from Pernod Ricard in premium whisky.

3. Margin Expansion Ahead

Lower input costs (ethanol prices down 8% YoY).
Operating leverage from higher sales.

4. Valuation Upgrade

Jefferies now values USL at 45x FY26E EPS (up from 40x), citing:
✔ Strong brand equity
✔ Pricing power
✔ Favorable regulatory environment

Financial Forecasts: What’s Changed?

Metric	FY25E	FY26E	Change vs Earlier Estimate
Revenue (₹ cr)	32,450	35,200	+5%
EBITDA Margin (%)	18.2	19.5	+130 bps
EPS (₹)	32.5	38.7	+12%

How USL Stacks Up Against Competitors

Company	Market Cap (₹ cr)	FY26E PE	Growth Outlook
United Spirits	1,02,500	42x	Premiumization & margin gains
Pernod Ricard India	78,200	38x	Stable but slower growth
Radico Khaitan	28,400	35x	Value segment focus

Key Takeaway: USL is now the most expensive liquor stock, reflecting its dominance in premium IMFL.

Stock Performance & Technical Outlook

Recent Price Action

Today’s High: ₹1,520 (+6.5%)
52-Week Range: ₹980 – ₹1,540
YTD Return: +34% (vs Nifty 50 +12%)

Technical Levels to Watch

✔ Support: ₹1,420 (200-DMA)
✔ Resistance: ₹1,600 (All-time high)

Investor Verdict: Buy, Hold, or Sell?

Bull Case (Buy)

Market leader in premium spirits
Double-digit earnings growth likely
Attractive play on India’s consumption boom

Bear Case (Caution)

High valuation leaves little margin for error
Regulatory risks (excise duty hikes)

Jefferies’ Recommendation: BUY (Target ₹1,760)

FAQs: United Spirits Stock Surge

Q1. Why is USL rising today?

Jefferies upgraded the stock and raised its target price to ₹1,760.

Q2. What is United Spirits’ dividend yield?

~0.8% (low, as most cash is reinvested for growth).

Q3. Is USL a good long-term investment?

Yes, if premiumization continues, but valuations are rich.

Q4. Who owns United Spirits?

Diageo PLC (UK) holds 55.9% stake.

Q5. When will USL hit ₹1,760?

Brokers expect it in 6-12 months if earnings meet forecasts.

Conclusion: Toasting to Growth

United Spirits is riding India’s premium liquor wave, and Jefferies’ upgrade confirms the Street’s optimism. While the stock isn’t cheap, its brand strength and margin expansion make it a top pick in the sector.

Key Levels:

Short-term: ₹1,500-1,600 range
Long-term: ₹1,760 (Jefferies target)

Disclaimer: Not investment advice. Do your own research

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Sourashis Chanda

Author (Intern) at Bitlance Tech Hub Private Limited | [email protected]

Sourashis Chanda brings readers their unique perspective on Business, Economy, Health and Fitness. With a background in Health and Physical Fitness of 2years, I am dedicated to exploring [what they aim to achieve with their writing, on the sustainable Economy of the country, various pro tips about business, latest goverment news, with some tips in health are and Fitness.