Buy Radico Khaitan Ltd For Target Rs. 3,000 by Motilal Oswal Financial Services Ltd
* We expect 22% revenue growth. In P&A, we model 17% volume growth and 23% revenue growth. In popular, we expect 40% revenue growth and 35% growth in volume.
* We expect GM to expand 200bp YoY to 43.5% on stable RM prices and improving product mix. EBITDA margin is expected to expand 120bp YoY to 14.3%
* Radico has a mid- to high-single-digit revenue contribution from Maharashtra, so the impact of the increase in excise duty will be lower compared to other branded players.
* The success of new launches will be a key monitorable for the company’s performance.
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