United Breweries' margin slips as costs outpace Q4 revenue growth
Revenue grew 8.52% sequentially, but expenses rose 14.24%, cutting operating margin by 4.70 percentage points.
Filed 05 May 2026, 20:29 IST · after market close · United Breweries Ltd (UBL)
Key takeaways
- Standalone operating margin fell 1.83 percentage points year on year as revenue declined 3.17% while expenses fell only 1.24%.
- Net profit rose 4.41% year on year, but other income contributed 70.54% of pre-tax profit and the tax rate fell 13.58 percentage points.
- United Breweries' 6.19% operating margin was 10.56 percentage points below the 16.75% median for 26 reporting FMCG peers.
Price around the results
Q4 profit growth relied on below-operating-line support
Standalone revenue declined 3.17% year on year, while operating profit fell 25.29%. Net profit still rose 4.41% because the tax rate dropped 13.58 percentage points and other income accounted for 70.54% of pre-tax profit. Interest expense also increased 394.72% year on year.
Sequential sales momentum came with sharper cost pressure
Revenue increased 8.52% sequentially, but expenses grew 14.24%, so operating margin narrowed 4.70 percentage points. Year on year, expenses fell less than revenue, which reduced margin by 1.83 percentage points. Interest expense rose another 72.24% sequentially, while depreciation increased 10.21%.
Margin remains volatile and trails the FMCG peer set
Operating margin moved from 10.85% in Q1FY26 to 6.34% in Q2FY26, 10.89% in Q3FY26 and 6.19% in Q4FY26, making the latest quarter a renewed drop rather than a third straight decline. United Breweries ranked fourth from bottom among the 26 reporting peers on operating margin, at 10.56 percentage points below the sector median.
The market reaction was unusually negative for UBL
The stock fell 2.82% on the first trading day after the results and was down 4.99% after five sessions. Across its last eight result reactions, the stock rose five times and fell three times, with a median absolute move of 0.52%, making this decline notably larger than its usual response.
Q4FY26 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹2,248 cr | ₹2,071 cr | +8.52% | -3.17% |
| Other income | ₹82 cr | ₹-8 cr | — | +942.80% |
| Expenses | ₹2,109 cr | ₹1,846 cr | +14.24% | -1.24% |
| Operating profit | ₹139 cr | ₹225 cr | -38.29% | -25.29% |
| Operating margin (%) | 6.19% | 10.89% | — | — |
| Interest | ₹29 cr | ₹17 cr | +72.24% | +394.72% |
| Depreciation | ₹76 cr | ₹69 cr | +10.21% | +33.97% |
| Profit before tax | ₹116 cr | ₹132 cr | -11.99% | -11.78% |
| Tax | ₹14 cr | ₹51 cr | -71.82% | -57.92% |
| Net profit | ₹102 cr | ₹81 cr | +25.78% | +4.41% |
| EPS (₹) | ₹3.85 | ₹3.06 | +25.82% | +4.34% |
Operating margin of 6.19% compares with a Fast Moving Consumer Goods sector median of 16.75% across 26 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -2.82% | -4.06% |
| Next session | -1.76% | — |
| 5 sessions | -4.99% | -2.41% |
| 15 sessions | -7.84% | — |
| 30 sessions | -7.74% | — |
Volume on the results session was 5.33× its 20-day average.
What to watch
- Whether operating margin recovers from 6.19% after the 4.70-percentage-point sequential decline.
- Whether expenses continue to grow faster than revenue after rising 14.24% sequentially against revenue growth of 8.52%.
- Whether other income remains a major contributor after accounting for 70.54% of pre-tax profit.