United Spirits Limited share witnesses 18 per cent surge; company reports better than expected profit

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Published: October 28, 2017 12:16:38 PM

The market capitalisation of the company, majority controlled by Britain's Diageo, rose from Rs 37,425 crore ($5.75 billion) to Rs 44,025 crore ($6.8 billion).

The India’s largest drinks maker has touched its highest level in nearly two years. (Representative photo: PTI)

United Spirits Limited (USL), the alcoholic beverages company’s share rose about 18 per cent, as reported by the Times of India. With this, the India’s largest drinks maker has touched its highest level in nearly two years. It also added more than $1 billion to the market cap after the company reported a better than expected profit. The market capitalisation of the company, majority controlled by Britain’s Diageo, rose from Rs 37,425 crore ($5.75 billion) to Rs 44,025 crore ($6.8 billion).

As per the report by TOI, the world’s second-largest spirits company by volume is also expecting the impact of the highway liquor ban to fade away by the end of the year. Chief executive Anand Kripalu was quoted as saying that the after the Supreme Court clarified that highway liquor ban does not apply within city limits, the things have started to turn better since September for the industry in general. He said that the impact of the ban will go down by the end of this year and business will normalise, reported TOI. USL has also reiterated its medium-term guidance of double digit revenue growth.

In December last year, the Supreme Court had banned the sale of liquor within 500 metre of national and state highways, except in Meghalaya and Sikkim, reported PTI. The apex court in August this year, however, said that there was no need to further clarify its order on prohibiting liquor vends within 500 metre of the national and state highways across the country. The apex court recently modified its order and allowed the sale of liquor within 500 metre alongside highways in some hilly areas and in Chandigarh, where the highways near the city have been denotified.

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