Hello Investors!! Most of you guessed it right. The answer to our last poll is *United Spirits Ltd (UNSP)* 🔗 https://tinyurl.com/United-Spirit United Spirits Ltd (USL) is India's largest alcoholic beverage company and the world's second-largest spirits company by volume. A subsidiary of Diageo PLC (55.94% stake), USL manufactures, distributes, and sells a wide range of spirits from whisky to vodka to rum across every price point. * 1 in every 2 branded spirits bottles sold in India comes from a USL brand. * With 120+ brands, 11 of which sell over a million cases annually and McDowell's No.1 itself crossing 25 million cases, USL serves every kind of consumer, from casual drinkers to luxury connoisseurs. *Brand Portfolio* * Mass Appeal (Popular) – Bagpiper, Old Tavern * Premium & Luxury – Signature, Antiquity, Black Dog * Global Icons – Johnnie Walker, Captain Morgan, Smirnoff, Baileys (via Diageo licensing) *Key Financial Metrics* * PE Ratio: 73.9x * Debt-to-Equity: 0.0 * 5-Yr Sales Growth: 3.9% * 5-Yr Profit Growth: 15.5% * 5-Yr ROE: 17.4% * Competitive Edge *1. Strong entrenched footprint & regulatory moat* Each state in India tightly regulates the alcohol industry, with different rules for production, pricing, and distribution. Advertising is also heavily restricted, making it difficult for new players to build brands and win customer loyalty. This gives USL a significant advantage. Over the years, USL has built a strong nationwide presence with a distribution network that covers around 70,000 outlets. They have also gradually exited regions where profitability was low, allowing them to focus where it matters most. *2. Franchising for focused growth* Since 2017, USL has been franchising many of its regular, lower-margin brands across 13 states. Under this approach * Franchise partners take care of manufacturing, distribution, and operational costs. * USL earns a steady, fixed annual fee. * It frees up USL to concentrate on its higher-margin Prestige brands. This model not only improves profitability but also reduces working capital needs, helping USL stay lean and focused. *3. Premiumisation from volume to value* While much of the Indian whisky market is still focused on the value segment, USL has taken a different path. They have been steadily pushing for premiumisation, focusing on selling better products rather than simply more products. With global promoters like Diageo at the helm, the company has been raising quality standards across the board. This focus on premium products has helped USL protect its margins even when faced with rising input costs and market challenges. *4. Reviewing the popular portfolio* To stay on course for long-term profitable growth, USL is also reviewing a part of its Popular brands portfolio. This review will cover about half of the brands by volume, but flagship names like McDowell's No.1 and Director's Special will not be part of it. The idea is to sharpen focus on the core Popular and Prestige segments and ensure sustainable, profitable growth going forward.