Radico Khaitan posts record Q1 profit as premium spirits drive 70.5 per cent PAT growth

New Delhi: Business is certainly on the rocks for many consumer companies, but Radico Khaitan has poured itself a winning quarter. The liquor maker reported record first-quarter revenue and profit for FY2027, powered by robust demand for premium spirits, expanding margins and a sharp reduction in debt.

The company reported net revenue from operations of Rs 1,683.7 crore for the quarter ended June 30, 2026, up 11.8 per cent from Rs 1,506.4 crore a year earlier. Gross revenue from operations crossed the Rs 5,800 crore mark for the first time, rising 10.4 per cent to Rs 5,867.7 crore from Rs 5,313.5 crore in the corresponding quarter last year.

Operating performance improved sharply during the quarter. EBITDA jumped 50.9 per cent year-on-year to Rs 348.1 crore from Rs 230.7 crore, while EBITDA margin expanded by 536 basis points to 20.7 per cent from 15.3 per cent. Gross profit rose 27.7 per cent to Rs 826.8 crore, with gross margins improving 610 basis points to 49.1 per cent.

The company attributed the margin expansion primarily to a favourable raw material environment, which contributed around 75 basis points to margins. However, gains were partly offset by an estimated Rs 30 crore impact from higher packaging costs and supply chain disruptions linked to the West Asia crisis.

Profit before tax surged 69.7 per cent to Rs 301.4 crore from Rs 177.6 crore a year earlier. Total comprehensive income climbed 70.5 per cent to Rs 225.4 crore from Rs 132.2 crore, while basic earnings per share increased 69.5 per cent to Rs 16.88 from Rs 9.96. Return on capital employed strengthened to 26.9 per cent.

The biggest driver of growth remained the company’s premiumisation strategy. Total Indian Made Foreign Liquor (IMFL) volumes, including royalty brands, rose 2.8 per cent to a record 10 million cases. Within that, Prestige & Above volumes surged 35.8 per cent to 5.22 million cases from 3.84 million cases last year.

Revenue from the Prestige & Above portfolio increased 36 per cent to Rs 970 crore and accounted for 76.8 per cent of total IMFL revenue, compared with 66.7 per cent in the same quarter last year. The segment also contributed 53.1 per cent of the company’s own IMFL volumes, reflecting the continued shift towards higher-margin brands.

In contrast, Regular & Others volumes declined 15.1 per cent to 4.61 million cases, while revenue from the category fell 17.3 per cent to Rs 289.3 crore. The company said the decline reflected a high base created by route-to-market changes in Andhra Pradesh last year, along with policy changes in Maharashtra and Karnataka. Non-IMFL revenue also slipped 3.5 per cent to Rs 421.2 crore due to higher captive consumption and lower bulk alcohol sales.

Managing director Abhishek Khaitan highlighted the rapid expansion of India’s vodka market, whose share of the IMFL industry increased from 4.6 per cent to 6.1 per cent during the year.

The company’s flagship vodka brand, Magic Moments, benefited significantly from this trend, recording a 43 per cent jump in volumes to more than 3.25 million cases during the quarter. The brand now commands around 60 per cent of India’s vodka market and has been strengthened with new regional flavours including Jamun SpicyMint, Alphonso Mango and Thandaai.

Among whiskies, After Dark Blue continued its strong momentum after posting 63 per cent growth during FY2026 and crossing 3.1 million cases. The brand was relaunched across 21 states during the quarter. 8PM Premium Black Whisky also continued expanding across 24 states following recognition at the Monde Selection Awards.

The company’s luxury portfolio also continued to expand globally. Rampur Indian Single Malt Whisky now offers eight expressions across nearly 50 countries and 35 travel retail locations. Jaisalmer Indian Craft Gin holds around half of India’s luxury gin market and is available in nearly 40 countries, while Sangam World Malt Whisky and Kohinoor Reserve Indian Dark Rum have expanded across 40 overseas markets.

Operating expenses rose 4.6 per cent to Rs 1,387.7 crore during the quarter. Cost of goods sold remained largely flat at Rs 856.9 crore, down 0.2 per cent year-on-year. Employee benefit expenses increased 23.7 per cent to Rs 68.4 crore, while selling and distribution costs rose 22.6 per cent to Rs 180.1 crore. Other operating expenses increased 7.5 per cent to Rs 229.4 crore, depreciation rose 13.7 per cent to Rs 41.2 crore and finance costs fell 26.9 per cent to Rs 11.7 crore as debt levels declined.

Advertising and sales promotion expenditure stood at 6.9 per cent of IMFL revenue, compared with 5.8 per cent a year earlier, remaining within the company’s stated target range of 6 to 8 per cent.

The balance sheet also showed continued deleveraging. Total debt stood at Rs 212.2 crore at the end of June, including term loans of Rs 72.1 crore after repayments of Rs 57.9 crore during the quarter. With cash and cash equivalents of Rs 106.1 crore, net debt declined by Rs 138 crore to Rs 106.1 crore, putting the company on track to become net debt-free in the second quarter of FY2027.

Buoyed by strong demand and improving market conditions, Radico Khaitan upgraded its outlook for the current financial year. The company now expects Prestige & Above volumes to grow by more than 25 per cent in FY2027 and reiterated its confidence in maintaining EBITDA margins of around 20 per cent.

Chairman and managing director Lalit Khaitan said continued investments in manufacturing capacity, backward integration and brand building would support sustainable growth as the company strengthens its premium portfolio and expands both in India and overseas.