The foreign investment bank said United Spirits can stem the market share loss to Pernod in the core India made foreign liquor (IMFL) category with the strategic review of the low end brands. Goldman Sachs said United Spirits has lost share to Pernod in the core IMFL category since the Diageo takeover in 2014 as they had an uncertain strategy regarding the low end brands.
Goldman Sachs said that United Spirits is well positioned to take bolder steps on the poplar brands with popular volumes and franchising incomes in a disarray due to the pandemic disruption.
The investment bank said the coronavirus pandemic has offered United Spirits a unique opportunity to revisit the low-end IMFL strategy and push the scotch agenda.
“… on scotch, the pandemic has led to increased domestic consumption (since duty-free has been not been accessible) and UNSP can leverage this habit change to grow their scotch business faster, doubling the scotch contribution to retail sales to 16% in CY30,” said Goldman Sachs.
