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Investing.com - CLSA initiated coverage on United Spirits Ltd. (NSE:UNSP) with a Hold rating and a price target of INR1,238.00 on Tuesday.
The research firm identified United Spirits as a leading spirits company in India, operating in what it describes as a heavily regulated category with limited pricing power at mass price points.
CLSA noted that while premiumization is accelerating in the Indian spirits market, leading to growth in the profit pool, recent policy changes have tempered its near-term growth expectations for the company.
The firm highlighted United Spirits’ advantageous position with a large local prestige and above portfolio, along with access to Diageo (LON:DGE) brands as a subsidiary, supporting its positive longer-term outlook.
Despite these strengths, CLSA cited the stock’s demanding valuation at 54x one-year forward price-to-earnings ratio as a key factor in its Hold rating decision.
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