Allied Blenders falls on profit booking post Q3; ICICI Sec cuts target

ICICI Securities has reduced Allied Blenders share price target to ₹520 from ₹540 earlier. The new target price implies upside potential of 14.13 per cent from current levels

Allied Blenders and Distillers share price today

Allied Blenders and Distillers share price fell on Friday as investor booked profit in the counter amid an in-line December quarter results for the current financial year (Q3FY26). The scrip fell as much as 2.7 per cent to ₹444.05 on the National Stock Exchange (NSE). 

 

The counter has seen a trade of 0.05 million shares so far on the National Stock Exchange (NSE). Allied Blenders and Distillers had a market capitalisation of ₹12,491.86 crore. 

 

As of 9:46 AM, Allied Blenders and Distillers share price was trading 0.13 per cent down at ₹455.60, as compared to a 0.50 per cent decline in the Nifty 50 index. 

 

 

In the last 12 months, the stock has increased 12.83 per cent, compared to an 8.63 per cent advance in the Nifty 50 index. 

 

Why did Allied Blenders and Distillers share price fall today?

Allied Blenders and Distillers share price declined after the company's Q3 results came largely in-line with Street estimates. 

 

Allied Blenders and Distillers reported that its revenue from operations increased 2.8 per cent Y-o-Y to ₹1,003 crore from ₹974 crore. The reason behind muted topline growth was a volume decline in popular brands owing to route-to-market changes in Telangana and policy-led price changes in Maharashtra. Telangana is Allied Blenders and Distillers' largest market. 

 

Total sales volume, however, grew by 1.3 per cent Y-o-Y to 9 million cases, with P&A (Prestige & Above) volume up 16.9 per cent Y-o-Y (4.4 million cases), but Popular volume declining by 9.6 per cent Y-o-Y (4.7 million cases).

 

Popular brands' realisation was at ₹833 per case, which indicated a 2.3 per cent decline on year.

 

However, Allied Blenders and Distillers managed to maintain a strong profitability because of favourable products, state mix, backward integration, and operational efficiencies. The company reported a net profit increase of 10.9 per cent on year to ₹63.7 crore in the third quarter (Q3FY26) from ₹57 crore in the corresponding period of the previous financial year (Q3FY25).  

The company saw its gross margin expanding 351 basis points on year because of soft input costs along other operational efficiencies. Ebitda margin also expanded 154bps Y-o-Y to 13.5 per cent.

 

ICICI Securities on Allied Blenders and Distillers

Analysts at ICICI Securities have maintained their 'Add' rating on the stock, lauding the company's strong performance in its P&A brands; profitability exceeding expectations, driven by favourable product and state mix, backward integration, and operational efficiencies; and operating cash flow (OCF) generation of ₹173 crore in Q3.

 

"The company's backward integration projects are on track. Polyethylene terephthalate(PET)-bottle manufacturing, that was commissioned in the September quarter (Q2FY26), has turned Ebitda-accretive in the third quarter. The expansion of the single-malt distillery and extra-neutral alcohol are also on track and will likely be completed by the current quarter (Q4FY26) and fourth quarter of the next financial year (Q4FY27), respectively," ICICI Securities noted.

 

Factoring-in this quarter's results, the brokerage has tweaked its estimates, assuming revenue, Ebitda, and PAT CAGR of 11 per cent, 16 per cent, and 19 per cent, respectively, over FY25–28. 

 

"ABDL is trading at 20.2x EV/Ebitda on FY27 estimates while Radico and United Spirits are trading at 31.5x and 34.8x EV/Ebitda on FY27 estimates, respectively. We maintain 'Add' with a revised target price of ₹520 (₹540 previously)," it said.  The new target price implies upside potential of 14.13 per cent from current levels, and values the stock at 43x PER on September 2027 estimates.

 

Significant downtrading due to tax hikes, a potential ban on spirits in states, and higher-than-expected inflation in key raw material prices, and changes in consumer preferences will likely pose a risk to Allied Blenders and Distillers’ growth, ICICI Securities said. 

 

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