Liquor Stocks To Watch: Premium spirits shine as beer faces headwinds – See MOFSL’s top picks

The alcohol and beverages sector reported resilient demand in 2QFY26, driven by premium spirits and improving consumption across key states.

Overall, the sector delivered sales growth of 11 per cent and EBITDA growth of 14 per cent, reflecting strong underlying momentum despite challenges in certain segments, says MOFSL.

United Spirits (UNSP) recorded 8 per cent growth in premium & above (P&A) volumes, led by strong trends in Andhra Pradesh. MOFSL has a Neutral rating with a target of Rs 1,575. At the current price of Rs 1,428, the potential upside is 10.3 per cent.

Radico Khaitan saw record volume growth of 38 per cent, with 22 per cent growth in P&A segments, supported by strong premium demand, according to MOFSL. MOFSL has a Buy rating with a target of Rs 3,600. At the current price of Rs 3,286, the stock offers an upside of 9.5 per cent.

MOFSL maintains a Neutral rating with a target of Rs 1,750. With a current price of Rs 1,704, the stock has an upside of ~2.7 per cent.

ABDL continued its strong performance with 30 per cent P&A growth, while Tilak Nagar grew 16 per cent YoY, aided by positive trends in southern markets. Both companies benefited from premiumization and steady demand in key regions.

UBBL’s beer volumes declined 3 per cent due to weak summer and extended monsoon, though premium segments rose 17 per cent YoY. Sula reported mid-single-digit growth in its own brand, but margins fell due to mix shifts and high-cost inventory.

Margin performance was largely stable or improved for most players. UNSP expanded EBITDA margin by 340bp to 21.2 per cent, Radico Khaitan by 130bp to 15.9 per cent, and ABDL improved to 12.7 per cent.

Meanwhile, Tilak Nagar, UBBL, and Sula saw margin contractions due to operating leverage and mix changes.