UBL: Despite subdued Q1, growth prospects over medium term look positive

Supportive demographics and low beer penetration indicates strong growth opportunity for the beer market leader

Despite beer major United Breweries (UBL) reporting a lacklustre performance in the June quarter (Q1) and its near-term outlook looking hazy because of the Covid-19 pandemic’s spread, its stock price has risen about 8 per cent since the result announcement on August 14. During this period, the BSE Sensex has risen 1.5 per cent.

Good growth prospects over the medium term, led by supportive demographics and low penetration of beer, is keeping the Street positive on the stock.

“Notwithstanding the near-term impacts, we remain positive on the medium-term outlook of UBL on the back of the huge growth potential for the beer