Soaring raw material costs to hurt India's United Breweries margins, analysts say

United Breweries

06/08/2026 07:20

    ** Margins of India's United Breweries  UBBW.NS  remain
under pressure despite volume recovery, analysts say
    ** Company posted lower first-quarter profit on Tuesday,
pressured by high raw material costs and stiff competition  
    ** Ambit Capital and Dolat Capital say UBBW reports 9%
volume growth in the quarter, driven by strong demand in
Karnataka, Maharashtra and Jharkhand, but growth trails industry
expansion of about 13% 
    ** Both brokerages say inflationary pressures linked to
glass bottles, packaging, freight and energy costs weigh on
profitability, with gross margin contracting about 155 bps-165
bps and EBITDA falling about 9% Y/Y 
    ** Ambit Capital says regulatory challenges, limited pricing
flexibility and continued input-cost inflation likely to keep
FY27 margins under pressure, prompting it to cut FY27 EBITDA and
PAT estimates by 11% and 9%, respectively
    ** Dolat Capital says headwinds from cost inflation, higher
brand investments and rising depreciation outweigh benefits from
premiumisation and price hikes 
    ** YTD, stock down 12.44%


 (Reporting by Kashish Tandon in Bengaluru)
 ((Kashish.tandon@thomsonreuters.com))