People have solid brand preferences especially for luxury ones. Dont see people switching due to lower costs. Each brand has a following but for ones that are imported, loyal customers will get it cheaper. I think if you see it other way around, the market also opens up for Radico Khaitan so in my view it doesnt do any harm.
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I don’t know how the conditions will be written for scotch in U.K FTA but study trade agreement with Australia there Australian wine duties are relaxed in a staggered manner meaning duties will be hived slowly in coming years, so there won’t be a sudden huge discount.
Can you share more details of it? Anyway scotch production cannot be simply increased by opening tap as scotch requires minimum 3 years of storage in scotland before coming in market. Disclosure : Recently adding more at 830 levels in small quantity in yesterday fall.
Strong delivery on volume front as well as total revenue front YoY and QoQ
Margins as a usual trend of Q3 impacted due to high input cost higher power and fuel.
In my opinion, margins will come back, but their ability to execute growth QoQ shows strength in execution which market leader also couldn’t deliver
Disclosure : invested at lower levels.
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Q4 FY22 Concall Highlights
In this quarter prestige and above category grew by 28% in volume and value.
In FY22 volume grew by 18% versus industry growth of 13%.
8PM Premium Black whisky which achieved a million case mark last year has crossed two million cases volume.
Recently launched Royal Ranthambore Whisky and Magic Moments Vodka are now available across seven states.
expect to maintain the volume expansion trajectory of 13% to 15% in FY23 with stronger Prestige & Above growth.
Price increase and commissioning of rampur dual feed plant is expected to help in profitability improvement during the second half of FY23.
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Commissioning of dual feed plant will enable processing of both grain based as well as molasses based raw material into alcohol. It gives Radico flexibility to operate on both type of raw materials. How it can helps in increasing the profitability of company?
Can anybody throw some light on change in excise policy of punjab government (due to advent of AAP government) which is going to happen from july 1 to affect the profitability of Radico khaitan? I think with cheaper scotch and other foreign brands it will increase the competition of radico khaitan.
Dis: Invested from 850 levels and unable to draw any conclusion from concall to add further. Views may be biased & my perception of seeing things can be wrong.
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If banned I feel the already established players will be benefited as new players will not be able to promote.
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None of the guidelines seem something that should prevent any player.
The guidelines seem reasonable and might require clarity before publishing, which generally the ad agencies get from the relevant government departments . Seems like some basic changes in what is a routine affair for ad agencies to promote these products.
I didn’t say prevent. I said existing players will be benefited as they have already established their brand.
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Update on insider buying -
One of the buyer is - Whole Time Dir/Dir:Operations and another one is VP of Finance.
Also the highlights for the Q1’23 results.
Disc - Invested, Biased
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Innovative launch, Magic Moment vodka cocktails.
Ready to drink beverages with low alcohol content.
Price will be between 200-250.
Just need to see how people take it.
On whisky side.
IMO one price range that they really miss is 900-1000 range where other players are present with their products like BP, Oaksmith, Golfers Shot etc.
Radico is present in lower end with 8PM, Top middle with Royal Ranthmbore(Good Whisky) Premium with Rampur Single Malt.
If they can come up with new product in this price range that might give boost to their overall portfolio.
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Not sure if the launch is innovative.
They already have the product launched few years back with name “Electra” , might be rebranding this highlighting “Magic moments” brand name more (and in can format)
you can see the product page here : Electra RTD - Radico Khaitan
Doubt the product hasn’t got the response they expected.
If they are re-launching the same product, I expect management to communicate this as a re-launch instead of completely new product.
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Electra was a clear failure and they had to withdraw the same from markets with huge expired stocks
I do agree with your point regarding Electra,
but they would have definitely learned from failure of Electra and might have got some feedback from customers also and thats why Radico might be coming with this new launch.
I hope, they are not launching same product in new clothes. Which will definitely lead to failure.
The volume growth in prestige and above segment looks very good. The contribution of this segment in overall volume has also gone up from 30 odd % to 37%, on QoQ & YoY basis. If we look at total volume then it has also inched upward.
The volume growth and product mix change (from lower margin products to higher margin “prestige and above” segment) ideally should have resulted in the better margins but RM prices are being counterproductive.
However I believe that margins are somewhere near bottom and can start moving up. This is just a guess and company has seen even lower margins (currently around 12% and lowest were 10%) so even more margin erosion can not be ruled out.
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Next Q onwards the backward integration kicks in. That shall lead to stabilization/some degree of expansion in margins. Inflation in glass cost and packaging also hitting the Gm’s
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Very good management interview.
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New whisky launch.
Sangam World Malt Whisky.
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Not sure how credible this is
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