New beer launch expected to boost United Breweries share price by 20%
Launch of a new beer is expected to help United Breweries share price rise 20%, said Nuvama Institutional Equities. Heineken Silver Draught Beer will be launched exclusively in premium bars and pubs across Mumbai, Thane, and Pune in Maharashtra, with plans to expand to Karnataka in the fiscal year 2024. “This launch is a meaningful expansion of United Breweries’ portfolio and shows its intent to focus on innovation," said Nuvama nstitutional Equities.
This variant has already garnered immense appreciation in global markets. Also Read: Day trading guide for stock market today: Six stocks to buy or sell on Wednesday — 29th November “We see this as another segmentation and premiumisation step by UBBL. It shall be marketed as a premium and smooth beverage for social occasions and is crafted by seasoned brewers utilising only natural ingredients, including Heineken’s renowned unique A-yeast and 100% malt," Nuvama Equities noted.
The brokerage maintained a ‘Buy’ rating on United Breweries with a target price of ₹1,935 per share, implying an upside of 20% from Tuesday’s closing price. The brokerage house remained positive on the Kingfisher beer manufacturer for a slew of factors that it believes will aid the company’s growth. Analysts at Nuvama believe the appointment of new MD & CEO Vivek Gupta uncorks a renewed steady push.
The brokerage is of the view that the worst of gross margins is behind given that the company has almost utilised its high-priced inventory in Q2FY24. This along with a correction in barley on a year-on-year (YoY) basis would help the company improve gross margins. Moreover, in the past one year, a few state governments have rationalised policies for beer makers, reduced taxes and revised tax rates
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