United Spirits profit rises despite a 20.91-point annual margin setback
Revenue fell 10.36% year on year, while lower interest and tax costs helped net profit rise even as profit before tax declined 44.71%.
Filed 22 Jul 2026, 19:38 IST · after market close · United Spirits Ltd (UNITDSPR)
Key takeaways
- Consolidated revenue fell 10.36% YoY while expenses declined 4.12%, compressing operating margin by 5.48 percentage points to 15.84%.
- Reported net profit rose 10.91% YoY despite a 44.22% fall in PBT, with the tax rate 1.22 percentage points lower and other income negative.
- The stock rose 0.98% on the first session and 9.09% by the fifth, against a median absolute post-results move of 2.06% across its last eight results.
Price around the results
Revenue contraction widens the operating squeeze
United Spirits reported a 10.36% YoY decline in consolidated revenue in Q1FY27, while expenses fell only 4.12%. The mismatch reduced operating profit by 33.39% and narrowed operating margin by 5.48 percentage points. Sequentially, revenue fell 11.33% and expenses fell 7.40%, resulting in a further 3.58-percentage-point margin decline.
Lower interest and tax rates cushion a weak PBT
Interest expense declined 38.78% YoY and depreciation fell 5.26%, but these savings did not offset the operating profit decline, leaving PBT down 44.22%. The tax rate was 1.22 percentage points lower YoY, providing some support to reported net profit, which rose 10.91%. Other income was negative at Rs 8.5 cr and represented -2.67% of PBT, so non-operating income was not a profit-quality support.
Margin remains below peers after an uneven year
Operating margin has moved from 21.32% in Q1FY26 to 20.80% in Q2FY26, 16.22% in Q3FY26, 19.42% in Q4FY26 and 15.84% in Q1FY27. The latest decline comes after the Q4 recovery and leaves the company 0.30 percentage points below the 16.14% median of 32 Fast Moving Consumer Goods peers that have reported.
The initial market reaction was modest, then widened
The stock rose 0.98% on the first session after the results, despite opening 0.31% lower, and outperformed the market by 1.51% that day. By the fifth session, the gain had reached 9.09%, with a 7.76% relative gain. The early move was below the stock's typical post-results reaction, while the five-session move was materially larger than its 2.06% median absolute move.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹2,708 cr | ₹3,054 cr | -11.33% | -10.36% |
| Other income | ₹-9 cr | ₹255 cr | — | — |
| Expenses | ₹2,279 cr | ₹2,461 cr | -7.40% | -4.12% |
| Operating profit | ₹429 cr | ₹593 cr | -27.66% | -33.39% |
| Operating margin (%) | 15.84% | 19.42% | — | — |
| Interest | ₹30 cr | ₹69 cr | -56.52% | -38.78% |
| Depreciation | ₹72 cr | ₹76 cr | -5.26% | -5.26% |
| Profit before tax | ₹319 cr | ₹703 cr | -54.69% | -44.22% |
| Tax | ₹82 cr | ₹135 cr | -39.26% | -46.75% |
| Net profit | ₹463 cr | ₹539 cr | -14.19% | +10.91% |
| EPS (₹) | ₹6.52 | ₹7.59 | -14.10% | +11.07% |
Operating margin of 15.84% compares with a Fast Moving Consumer Goods sector median of 16.14% across 32 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +0.98% | +1.51% |
| Next session | +4.49% | — |
| 5 sessions | +9.09% | +7.76% |
Volume on the results session was 1.79× its 20-day average.
What to watch
- Whether operating margin holds above 15.84% after the 5.48-percentage-point YoY decline.
- Whether revenue recovers from Rs 2708 cr while expenses remain below the pace of revenue growth.
- Whether the tax rate moves back from 25.75% and other income remains non-supportive.