Based on current estimates, Roy values RCB at ₹146 per share in their ₹1,885 target price for United Spirits, but if the reported $2 billion valuation is realised, that value could rise to ₹235. However, he pointed out that “lots of ifs and buts are there” as Diageo has not confirmed the sale and has previously denied such plans.
While the event could be positive for United Spirits’ stock, Roy emphasised that the outcome depends on whether the stake sale is full, partial, or shelved. The recent IPL win by RCB could also drive a valuation premium if the deal proceeds.
Roy sees stronger growth ahead in United Spirits’ premium segment, especially the Prestige & Above category, which grew 9.2% in the January-March quarter of 2025 (Q4FY25). He said, “That is the focus,” as premiumisation continues to play out. On the other hand, the popular segment remains under pressure due to urban slowdown and weaker demand from lower-end consumers, and is not seen as a short-term priority.
“Prestige” is a group of higher-priced, more premium products made by United Spirits. These are usually better quality and more expensive brands that bring in a large part of the company’s earnings.
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Looking forward, Roy expects several tailwinds to support United Spirits, including an increase in retail outlets in key states like Uttar Pradesh (UP) and Andhra Pradesh, reduced taxes in Karnataka, and long-term benefits from the UK free trade agreement (FTA) kicking in by 2026-27 (FY27).
The market capitalisation of United Spirits is around ₹1,17,689.00 crore. Its shares have gained close to 23% in the past year.
Also Watch | CNBC-TV18’s Mangalam Maloo breaks down the reported Diageo stake sale in Royal Challengers Bengaluru and highlights listed companies that own IPL franchises.
For the entire interview, watch the accompanying video
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First Published: Jun 10, 2025 3:32 PM IST
