stock market today Liquor stocks are rising today as the market rose sharply on such stocks on hopes of reduction in debt of liquor companies, on strong Q2 FY2021-22 numbers after tax exemptions announced by some state governments and grain prices remain the same. Is. Liquor major Radico Khaitan’s share price rose nearly 4 per cent, United Spirits shares rose over 3 per cent, while Globus Spirits shares rose nearly 4 per cent in the intraday trading session.
According to experts, event discounts are also playing their part as premium brand sales of various liquor companies have also increased due to the fast approaching festive season and the recent Covid-19 restrictions. He added that stocks like United Breweries, United Spirits or McDowell and Radico Khaitan can be bought for short to medium term-horizon.
Speaking on the major reasons behind the skyrocketing of liquor stocks; Avinash Gorakshakar, Head of Research, Profitmart Securities, said, “The stock of liquor is rising due to the recent tax exemptions announced by some state governments, including Uttar Pradesh, the largest consumer of alcohol in India. In addition, various liquor companies have increased their prices. Premium brands due to recent Covid-19 restrictions, resulting in strong Q2 numbers of these companies. Market is giving some relaxation to these liquor stocks as some new premium brands are coming fast. Liquor can come in the market during the festive season. He said that the prices of cereals remain low, hence in the coming season, liquor companies are expected to get the benefit of thi8s in their grain based products, especially beer.
Echoing the thoughts of Avinash Gorakshakar; Saurabh Jain, AVP – Research at SMC Global Securities said, “The market is offering event discounts on all consumer durable products including liquor. In view of the fast festive season, the sales of liquor, especially the premium brands, are heading north. In that case, Liquor manufacturing companies are expected to get better business in the upcoming quarters and hence their quarterly numbers are expected to be higher as compared to Q1 FY22 results. Since, Q1 numbers of most of the liquor companies Were strong; their next quarter results are expected to be even stronger.”
advising investors to buy liquor stocks for the short term; Sumeet Bagadia, Executive Director, Choice Broking said, “One can buy Radico Khaitan shares for a short-term target at the current market price. ₹from 970 ₹maintain stop loss at 1000 ₹One can buy shares of United Spirits or McDowell at the current market price for a target of 890. ₹780 to ₹maintain stop loss at 800 ₹740 each.”
Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
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