Radico Khaitan Q1 FY2027: Record volumes, sharp premiumisation, and a 20.7% EBITDA margin

Radico Khaitan started FY2027 with its strongest quarterly performance on record. In Q1 FY2027, the company reported total volume of 10.00 million cases and net revenue from operations of INR 1,683.7 crore, up 11.8% year-on-year. Profitability expanded faster than revenue. EBITDA rose 50.9% to INR 348.1 crore and EBITDA margin widened to 20.7%, its highest level in the data shown in the presentation. Total comprehensive income increased 70.5% to INR 225.4 crore.

The quarter’s defining feature was the continued shift toward higher-value products. Prestige and Above volumes grew 35.8% year-on-year to 5.22 million cases. In contrast, Regular and Others volumes declined 15.1% to 4.61 million cases. Management attributed the regular segment decline to a high base in Q1 FY2026 after a route-to-market change in Andhra Pradesh, alongside policy changes in Maharashtra and Karnataka.

On the revenue side, the mix shift was even clearer. IMFL net revenue rose 18.0% to INR 1,262.5 crore, led by 36.0% growth in Prestige and Above revenue to INR 970.0 crore. Non-IMFL revenue declined 3.5% to INR 421.2 crore, which management linked to higher captive consumption and lower bulk alcohol sales.

The financial snapshot: revenue and profitability moved to a higher band

The company’s gross margin expanded to 49.1% in Q1 FY2027 from 43.0% in Q1 FY2026, an expansion of 610 basis points year-on-year. Management cited a relatively benign raw material scenario and ongoing premiumisation as key drivers, and also quantified a headwind: packing material price volatility had an approximately INR 30 crore financial impact during the quarter. Despite this, operating leverage and mix gains helped deliver record EBITDA.

Premiumisation as the core strategy: Prestige and Above now dominates the mix

Radico Khaitan’s quarter reinforced a multi-year direction: upgrading the portfolio and making premium brands the central growth engine. Prestige and Above contributed 53.1% of total own volume in Q1 FY2027, up from 41.5% a year ago. On a revenue basis, Prestige and Above formed 76.8% of total IMFL revenue in the quarter, compared with 66.7% in Q1 FY2026.

Magic Moments Vodka was positioned by management as a key beneficiary of changing consumption patterns. Management described vodka as being in a multiyear structural growth phase in India, highlighting that vodka saliency in the Indian IMFL market increased from 4.6% in Q1 FY2026 to 6.1% in Q1 FY2027. As per management commentary, Magic Moments holds over 60% market share in the vodka category and delivered 3.25 million cases in Q1 FY2027, up 43% year-on-year. Management also stated that flavoured vodka accounts for 75% of Magic Moments volumes, up from 65% last year, supporting both volume momentum and premiumisation.

Within whisky, the company continued to invest behind brands such as After Dark Blue and 8PM Premium Black. Management indicated After Dark received a packaging refresh to sharpen its contemporary premium appeal while retaining the blend. In the presentation, After Dark is described as having crossed 3.1 million case sales and being available in 21 states, while 8PM Premium Black is described as available in 24 states.

Guidance, cash flows, and capital allocation: moving toward net debt free

Management reiterated a more confident outlook for FY2027. The company upgraded its Prestige and Above volume growth guidance to over 25% for the full year and guided for EBITDA margin of around 20% for FY2027. Advertising and sales promotion (A and SP) spend was 6.9% of IMFL sales in Q1 FY2027 versus 5.8% in Q1 FY2026. Management expects to maintain A and SP around 6% to 8% of IMFL revenues, while noting quarter-to-quarter variation.

On leverage, Radico Khaitan reported net debt of INR 106.1 crore as of June 30, 2026, with a reduction of INR 138.0 crore since March 31, 2026. Management stated an expectation to become net debt free by Q2 FY2027. Interest expense declined 26.9% year-on-year to INR 11.7 crore in Q1 FY2027, consistent with deleveraging.

In the earnings call, management discussed capital allocation in the context of becoming debt free and having a minimum dividend distribution policy of 20%. It guided maintenance capex in the range of INR 150 crore to INR 170 crore. The management also stated that inorganic acquisitions would be considered only if they clearly make sense for shareholders, while emphasizing the company’s history of organic growth.

International presence and luxury portfolio: building India-to-world brands

The company continued to highlight its luxury portfolio development, anchored by brands such as Rampur Indian Single Malt Whisky, Jaisalmer Indian Craft Gin, and Sangam World Malt Whisky. In the earnings call, management stated that luxury portfolio turnover in FY2026 was about INR 475 crore and reiterated guidance of 25% growth in luxury sales value, indicating it is on track.

Exports remain a smaller share by volume, but meaningful from a brand-building perspective. Management stated that Radico’s brands are available in over 100 countries, export volume contribution is about 5% to 6% (with value higher), and travel retail presence has increased to 63 outlets from 50, with confidence to reach 100 in the coming years. Management also cited distribution milestones, including Rampur being available on Air India and Jaisalmer Gin on SpiceJet.

Takeaways from Q1 FY2027

Radico Khaitan’s Q1 FY2027 performance was driven less by broad-based category growth and more by premium mix gains. The company delivered record EBITDA and a step-up in margins even while acknowledging packaging material inflation pressures. The upgraded Prestige and Above growth guidance, the reiterated around 20% EBITDA margin outlook for FY2027, and the stated plan to become net debt free by Q2 FY2027 together form the quarter’s key investment narrative: premiumisation-led growth with improving balance sheet strength.