Shares of Allied Blenders and Distillers jumped over eight percent to Rs 317 per share on August 12, after a report in The Economic Times stated that the company is in advanced talks with two global spirits giants – Russian Standard and Thai Beverage to market and distribute their products in India.
The report added that the potential partnership would help the company diversify its product offerings beyond whisky, venturing into segments like vodka and scotch. The two international brands would also gain a strong foothold in India, which is one of the world’s biggest alcohol consuming country.
Listed just a month back, the stock of Allied Blenders has surged nearly 13 percent from IPO’s upper price band of Rs 281 apiece. The Rs 1,500-crore IPO also received a robust subscription at 23.55 times, led by non-institutional investors at 32.4x, qualified institutional buyers at 50x, and retail investors at 4.51x their allocated shares.
Going ahead, analysts at Sharekhan expect Allied Blenders’ earnings to grow multi-fold with debt reduction and premiumisation in focus in the medium-to-long term. They also believe that the company’s return profile to consistently improve, with return on equity and return on capital employed improving to mid-teens by the fiscal year 2026.
“The strengthening of balance sheet with debt repayment and focus on premiumisation will drive strong earnings growth aiding valuation gap compared with close peers to narrow over the next two to three years. Allied Blenders is trading at a financial year 2025 Enterprise Value to EBITDA multiple of 27x, while for financial year 2026, it is trading at 22x, which is at a discount compared to its closed peers,” the brokerage firm underlined, initiating a ‘viewpoint’ rating and Rs 450 as target price.
