Q1 2026 United Breweries Ltd Earnings Call Transcript
Key Points
- United Breweries Ltd (BOM:532478) reported an 11% increase in volume for Q1 FY26, indicating strong market share gains, particularly in Andhra Pradesh, Assam, UP, and Telangana.
- Premium volumes grew by 46%, with significant contributions from the Kingfisher Ultra franchise, Amstel Grande, and Heineken Silver.
- Net sales increased by 16%, driven by price increases in multiple states and a favorable mix from premiumization.
- The company has made significant investments in warehousing and cooler penetration, placing more coolers in the first six months than in the last five years combined.
- United Breweries Ltd (BOM:532478) is focusing on long-term sustainable growth, with strategic investments in supply chain, brand building, and premiumization efforts.
- Gross margin in Q1 was 42.5%, which is 50 basis points below the previous year, due to short-term margin pressures from interstate transfers and an unfavorable state mix.
- The company faced a 16% to 17% decline in business in Karnataka, a highly profitable state, due to category decline.
- There is a shortage of cans, impacting growth, with an estimated 1 to 2 points of growth lost over six months due to lack of availability.
- Despite a 16% revenue growth, gross and EBITDA margins have been lower, with margin expansion seen as a long-term play.
- The company is facing challenges with government infrastructure not being ready for growth, leading to additional expenses for truck retention outside government warehouses.
Ladies and gentlemen, good day, and welcome to the United Breweries Limited Q1 FY26 earnings conference call. (Operator Instructions) I now hand the conference over to Mr. Jorn Kersten, CFO. Thank you, and over to you, sir.
Thank you. Good afternoon, good day, and thank you for joining this earnings call on the first quarter of full year '26. I'm here together with Vivek Gupta, our MD and CEO. And we're happy to discuss the developments of quarter one for this financial year. I'm sure there's quite a few questions that will pop up, so we'll keep the introductory comments relatively short. I will address a few highlights, hand over to Vivek, and then we'll open up for the Q&A.
Volume Q1, we increased by 11%. Note that we are lapping the impact from the elections during peak season last year, but this comes coupled with strong estimated market share gains in the quarter, predominantly coming from Andhra Pradesh, Assam, UP and Telangana, but also partially offset by Karnataka
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