United Breweries Q1 Review – Better Than Expected; Path To Normalcy To Take Longer: Motilal Oswal

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The lockdown severely impacted Q1 FY22 on-trade sales (usually around 25% of total sales) and home delivery was not permitted in some states throughout the quarter.

Given these factors, United Breweries Ltd.’s results were better than expected, with sales 45% lower than Q1 FY20 sales (up 121% YoY over the low base of Q1 FY21).

Nevertheless, in a capital-intensive business, Ebitda/profit after tax declined 71%/83% versus Q1 FY20 levels.

June 2021 volumes were 50% lower versus June 2019 levels and restrictions on on-trade sales (low working hours, weekend lockdowns, etc.) have persisted in July 2021 in many states.

As a result, the path to normalcy for United Breweries would be gradual, unlike for other discretionary players.

Click on the attachment to read the full report:

Motilal Oswal United Breweries Q1FY22 Result Update.pdf


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