Radico’s Q2 margin eases QoQ but stays 4.29 points above peer median
Revenue grew 16.81% YoY as expenses rose 10.47%; management also upgraded Prestige & Above volume-growth guidance to 30%.
Filed 27 Oct 2026, 14:09 IST · Radico Khaitan Ltd (RADICO)
Key takeaways
- Consolidated net profit rose 66.49% YoY as revenue grew 16.81% and expenses increased 10.47%.
- Operating margin expanded 4.56 percentage points YoY, although costs grew faster than revenue sequentially and trimmed margin by 0.25 percentage points.
- Management upgraded FY27 Prestige & Above volume-growth guidance to 30% while retaining EBITDA margin guidance of around 20%.
Price around the results
Revenue growth lifted Q2FY27 profit sharply
Radico Khaitan reported consolidated revenue growth of 16.81% YoY, while expenses rose 10.47%, allowing operating profit to grow 50.34%. Lower interest costs, down 29.85% YoY, also supported the 66.49% increase in net profit. Other income contributed only 2.11% of profit before tax, so it was not a material driver of earnings.
Sequential cost growth paused the margin climb
Revenue increased 3.65% QoQ, but expenses grew 3.98%, causing operating margin to narrow by 0.25 percentage points to 20.47%. The YoY margin expansion was supported by revenue growing faster than costs, while the tax rate fell 0.50 percentage points and provided a modest additional benefit to net profit. Other income declined 27.07% QoQ, limiting its contribution to the quarter.
Margin remains above the reported peer median
Operating margin has risen from 15.42% in Q1FY26 to 20.72% in Q1FY27, making the 20.47% reported in Q2FY27 the first sequential decline after four consecutive quarterly increases. It remained 4.29 percentage points above the 16.18% median for the 11 Fast Moving Consumer Goods peers that had reported. The quarter therefore showed a pause in the margin trend, not a reversal of the year-long improvement.
Premium brands drove the portfolio commentary
Management said Prestige & Above volumes grew 35.8% in Q2FY27, with vodka volume growth of 49% and the portfolio reaching 2.96 million cases. It attributed regular-volume decline to a higher Andhra Pradesh base and policy changes in Maharashtra and Karnataka. Management also said grain-price increases led it to build higher stocks, which increased working capital during the quarter.
Past result reactions have been mixed
Across the eight previous result reactions in the history provided, the stock rose after five and fell after three, with a median absolute move of 2.07%. The recent sequence included a gain of 5.45% and a decline of 3.60%, so the stock has not followed a consistent one-way pattern after results.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,745 cr | ₹1,684 cr | +3.65% | +16.81% |
| Other income | ₹7 cr | ₹9 cr | -27.07% | +119.53% |
| Expenses | ₹1,388 cr | ₹1,335 cr | +3.98% | +10.47% |
| Operating profit | ₹357 cr | ₹349 cr | +2.39% | +50.34% |
| Operating margin (%) | 20.47% | 20.72% | — | — |
| Interest | ₹11 cr | ₹12 cr | -1.97% | -29.85% |
| Depreciation | ₹43 cr | ₹41 cr | +4.73% | +15.52% |
| Profit before tax | ₹309 cr | ₹305 cr | +1.38% | +65.40% |
| Tax | ₹77 cr | ₹75 cr | +1.94% | +62.18% |
| Net profit | ₹232 cr | ₹230 cr | +1.20% | +66.49% |
| EPS (₹) | ₹17.34 | ₹17.15 | +1.11% | +66.25% |
Operating margin of 20.47% compares with a Fast Moving Consumer Goods sector median of 16.18% across 11 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Prestige & Above volume grew 35.8% in Q2 FY2027, while premium volume growth was led by a 49% increase in vodka.
- The vodka portfolio reached 2.96 million cases in Q2 FY2027.
Guidance & outlook
- The company upgraded FY27 Prestige & Above volume growth guidance to 30%.
- The company reiterated FY27 EBITDA margin guidance of around 20%.
- The company expects A&SP spend to remain around 6% to 8% of IMFL revenues.
- The company expects to become net-debt-free during H2 FY2027.
Expansion
- Radico Khaitan is present across four major UK airports and is progressing towards 100 travel retail outlets.
- The company has around 70 travel retail outlets and is targeting 100 in the coming years.
New products
- The contemporary new look of After Dark Blue is resonating well in the whisky segment.
- Magic Moments is using flavour-led innovation to widen the vodka category and attract a new generation of consumers.
New initiatives
- The company is deepening on-trade presence through curated consumer experiences and key account partnerships.
- The company is continuing prudent marketing investments in existing core brands and new launches.
- The company strengthened its leadership team by elevating Dilip Banthiya to Executive Director & CFO and Saket Somani to Deputy CFO.
Competition
- Magic Moments is the fifth-largest vodka brand globally and the largest in India, with about 60% market share.
Problems & risks
- The company is facing heightened uncertainty around input costs and supply chains.
- Regular volume declined because of a higher Andhra Pradesh base and policy changes in Maharashtra and Karnataka.
- Increasing grain prices required the company to build higher stock levels, resulting in higher working capital.
- The company said the higher stock levels resulted in higher working capital during the quarter.
What to watch
- Whether consolidated operating margin holds above 20.47% after the 0.25-percentage-point QoQ decline.
- Whether Prestige & Above volume growth remains near the 35.8% reported in Q2FY27.
- Whether A&SP spending stays within management’s 6% to 8% of IMFL revenue range while it targets around 20% EBITDA margin for FY27.