Sula Vineyards, the largest wine producer in India, saw a notable rise in its stock price, increasing by almost 6.24% to reach ₹472.80 per share, in Monday's trading session. This surge came in response to the company's robust sales growth in the June quarter, with estimated net revenues showing a 17% YoY increase in Q1FY24.
In an exchange filing on July 07, the company said that its estimated revenue growth from its own brands rose by 24% YoY, reaching ₹103.5 crore, while the revenue growth from its wine tourism business grew by 11% YoY to ₹11.34 crore in Q1FY24.
"The company has recorded its highest ever Q1 net revenues overall as well as for its own brands and the wine tourism business," the company said.
Commenting on the Q1 sales update, Sula CEO Rajeev Samant said, “We are pleased to announce yet another quarter of strong double-digit growth both in our Own Brands and Wine Tourism businesses. Our focus on premiumisation continues to pay off, with our Elite and Premium wines leading the pack in terms of growth.”
"Our Wine Tourism revenues also grew in double digits, and we are particularly pleased with the 70% jump in visitor numbers to our Domaine Sula winery, just outside Bengaluru," he added.
Sula Vineyards is engaged in the manufacture, purchase, and sale of premium wine and other alcoholic beverages. The company's shares got listed on the exchanges on December 22, 2022, for ₹331.2 apiece, 7.2% lower than the issue price of ₹357.
However, the stock quickly rebounded, and it is currently trading at ₹464 apiece, 30% higher than its issue price. Earlier in March, global brokerage firm CLSA initiated coverage on the stock with a 'buy' recommendation and a price target of ₹475 apiece.
The largest selections of wines in the Indian wine market under the 'Elite' and 'Premium' categories are presently produced and marketed by Sula under a total of 34 labels. In terms of value, it held about 60% of the 'Elite' and 'Premium' groups in FY20 and FY21, said the brokerage firm.
The brokerage expects the company's revenue to grow at a CAGR of 19% over FY22–25CL (calendar year), with Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) growing by 1.86 times during the same period.
For FY23, the company reported a consolidated net profit of ₹84 crore, up by 61.5% over FY22's net profit of ₹52 crore, while the total revenue from operations during FY23 came in at ₹516 crore, 22% higher than ₹424 crore in FY22.
02 analysts polled by MintGenie on average have a 'strong buy' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.