Tilaknagar Inds: HDFC Sec keeps 'buy', bets on Imperial Blue's growth story

According to HDFC Securities, ground checks indicate that Tilaknagar Industries is effectively addressing state-specific requirements to strengthen the Imperial Blue franchise.

Tilaknagar Industries' focus on strengthening the Imperial Blue franchise in FY27 will bolster its pan-India presence and act as a critical enabler for upcoming launches and mid-teen volume growth over FY28-30, brokerage firm HDFC Securities said in a report.

 

The brokerage has retained its ‘Buy’ rating on the stock with a target price of ₹700, implying around 30 per cent upside from the previous close of ₹540.

 

On the bourses, Tilaknagar Industries shares surged over 7 per cent to hit an intraday high of ₹579.80.

 

According to HDFC Securities, ground checks indicate that Tilaknagar is effectively addressing state-specific requirements to strengthen the Imperial Blue franchise. Karnataka remains a key growth market, where the brand has seen strong traction following agile price cuts implemented immediately after tax changes. This has been followed by market-share gains in Andhra Pradesh, Uttarakhand and Rajasthan.

 

 

The company has also improved SKU availability and widened market supplies. These measures should help offset pressure in Maharashtra and West Bengal following the discontinuation of the low-priced SKU, the brokerage said.

 

HDFC Securities expects Tilaknagar to benefit from its premiumisation strategy. The company has expanded its organic portfolio with Monarch Legacy Brandy and Seven Island, while investments in Spaceman and Black Tiger Distilleries are helping expand its luxury and super-premium presence.

 

As Imperial Blue rebuilds market share, the brokerage expects Tilaknagar to expand its category and portfolio participation. Given the rapid growth in vodka, it also sees scope for the company to incubate an organic vodka brand.

 

HDFC Securities expects net debt to decline to ₹17 billion by March 2027, from ₹21 billion in June 2026, supported by internal cash generation and promoter conversion of warrants. The brokerage said any easing of restrictions on national brands in Tamil Nadu could materially improve Tilaknagar's prospects and strengthen its financial position. 

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