Reduce Radico Khaitan, target price Rs 925: HDFC Securities

HDFC Securities has reduce call on Radico Khaitan with a target price of Rs 925. The current market price of Radico Khaitan is Rs 1067.65.

Radico Khaitan, incorporated in the year 1983, is a Mid Cap company (having a market cap of Rs 14295.07 Crore) operating in Beverages - Alcoholic sector.

Radico Khaitan key Products/Revenue Segments include Alcoholic Products, Bottles (PET), Scrap, Royalty Income, Liquor, Jaivik Khad, Others, Export Incentives for the year ending 31-Mar-2022.

Financials
For the quarter ended 30-09-2022, the company has reported a Consolidated Total Income of Rs 762.33 Crore, down -76.09 % from last quarter Total Income of Rs 3188.17 Crore and up 7.28 % from last year same quarter Total Income of Rs 710.58 Crore. Company has reported net profit after tax of Rs 51.82 Crore in latest quarter.

The company’s top management includes Dr.Lalit Khaitan, Mr.Abhishek Khaitan, Mr.Krishan Pal Singh, Dr.Raghupati Singhania, Mr.Sarvesh Srivastava, Mr.Tushar Jain, Mr.Sharad Jaipuria, Ms.Sushmita Singha. Company has Walker Chandiok & Co. LLP as its auditors. As on 30-09-2022, the company has a total of 13 Crore shares outstanding.

Investment Rationale
Gross margin pressure is expected to sustain, the brokerage maintains sequentially flat margin at ~41% (down +400bps YoY).

Promoter/FII Holdings
Promoters held 40.27 per cent stake in the company as of 30-Sep-2022, while FIIs owned 18.35 per cent, DIIs 22.85 per cent.