Multibagger Alert: Rs 1 lakh invested in this liquor stock would have given you Rs 7.8 lakh in five years

Long-term investors have made a huge profit by investing in Radico Khaitan as it has surged by 687% in the last five years.

The stock of multibagger Radico Khaitan rallied from Rs 140 in October-2016 to Rs 1,109 today, gaining 687% in the last 5-years. Rs 1 lakh invested in 2016 would have become Rs 7.87 lakh in 2021.

From the beginning of the year 2021, the stock has rallied 142%, from Rs 456 to Rs 1,109. Rs 1 lakh invested in Jan-2021 would have become Rs 2.42 lakh today in just 10 months.

Products and brands

Radico Khaitan is one of the largest and oldest manufacturers of IMFL (Indian Made Foreign Liquor). The company has a wide range of branded portfolios across IMFL categories of Whisky, Brandy, Rum and White spirits. Currently, it has four millionaire brands which are 8 PM Whisky, Contessa Rum, Old Admiral Brandy and Magic Moments Vodka.

Market leader

Magic Moments leads the vodka Industry in India with over 58% market share whereas Morpheus Brandy leads the premium brandy category with over 56% market share. During the last decade, the company has launched 12 new brands of which 11 are in the premium category.

Highly experienced promoters 

Khaitan Family, the promoters and management of Radico Khaitan have been in the liquor industry since 1943. That is for more than seven decades of great experience.

Steep profit growth

In the last five years from FY16 to FY21, revenue has grown at a CAGR of 8% but profit has grown at a CAGR of 28% which shows the steep growth of the company. There is a decent increase in operating profit margin from 12% in FY16 to 17% in FY21, due to cost optimization in materials used for manufacturing.

Though stock had a massive rally in the past with strong performance, do you still think the company can utilize the present situation and gain momentum?