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Nomura Initiates 'Buy' on Allied Blenders, Sees Strong Growth to Rs 850 Target
M
Moneycontrol•29-09-2026, 15:25
Nomura Initiates 'Buy' on Allied Blenders, Sees Strong Growth to Rs 850 Target
- •Nomura initiated coverage on Allied Blenders & Distillers (ABDL) with a 'Buy' rating and a target price of Rs 850, driven by premiumisation, new launches, and backward integration.
- •The brokerage forecasts a 26% EPS CAGR over FY26-29F and expects a 370-basis-point expansion in EBITDA margin.
- •ABDL's Prestige & Above (P&A) segment, boosted by ICONiQ White whisky, recorded a 20% CAGR in volumes and sales over FY24-26, increasing its contribution from 37% to 47%.
- •ABDL plans significant investments in backward integration with a capex of over Rs 16 billion to improve supply security and drive cost efficiency.
- •Officer's Choice remains a strong core franchise with pan-India distribution, while ABDL's presence in 39 countries offers global expansion opportunities for newer brands.
Key Questions Answered
Nomura initiated coverage on Allied Blenders & Distillers with a 'Buy' rating and set a target price of Rs850. The target implies an upside of 19% from the company's previous closing price.
Nomura cited premiumisation, new product launches, backward integration, and operating leverage as the key drivers of growth for Allied Blenders. The brokerage forecasts a 26% EPS CAGR and a 370-basis-point expansion in EBITDA margin over the FY26-29F period.
Allied Blenders has a capex plan exceeding Rs16 billion focused on backward integration across malt, ENA, and PET to improve supply security and cost efficiency. The company targets a Prestige & Above volume mix of 50% by FY28.
