Biggest Intraday Rally Since 2013: This Stock Surges Over 10% as Net Profit Jumps 190% YoY, Driven by Premiumisation and Strong Volume Growth

The Indian equity markets were trading in the red on Wednesday, October 28, 2026. However, one stock that stood out amid the broader market weakness was United Breweries Limited (UBL), whose shares surged over 10 per cent during the trading session.

The rally marked the stock's sharpest Intraday gain since 2013, following the company's financial results for the quarter ended September 30, 2026. The earnings showed a substantial improvement in profitability, supported by higher beer sales volumes, growing demand for premium products and improved operating margins.

United Breweries Limited reported a 190 per cent YoY increase in standalone net profit to Rs 136 crore in Q2 FY27, compared with Rs 47 crore in the corresponding quarter last year. Net sales increased 24 per cent to Rs 2,536 crore from Rs 2,051 crore, driven by higher sales volumes, premiumisation and improved pricing.

The company, which markets popular beer brands including Kingfisher and Heineken, recorded 16 per cent growth in overall sales volumes during the quarter. However, premium beer volumes grew at a much faster pace of 38 per cent. As a result, revenue growth exceeded volume growth by eight percentage points, reflecting the contribution of premium products and pricing initiatives.

EBITDA More Than Doubles as Operating Margins Improve

Along with revenue growth, United Breweries reported an improvement in operating profitability during the quarter. EBITDA increased 108 per cent YoY to Rs 301 crore from Rs 145 crore in Q2 FY26. Consequently, the EBITDA margin expanded by 480 basis points to 11.9 per cent, compared with 7.1 per cent in the corresponding quarter last year.

Gross profit increased 29 per cent to Rs 1,134 crore from Rs 878 crore, while gross margin improved by 194 basis points to 44.7 per cent. This improvement was supported by higher sales volumes, a favourable product mix and cost management measures, which helped offset the impact of higher input costs associated with the Middle East conflict.

The improvement was also visible at the operating profit level, with EBIT increasing 161 per cent to Rs 212 crore from Rs 81 crore. EBIT margin expanded by 441 basis points to 8.4 per cent.

On the expenditure front, employee expenses increased 11 per cent to Rs 205 crore, while other expenses rose 19 per cent to Rs 669 crore. Finance costs also increased to Rs 28 crore from Rs 15 crore in the year-ago quarter.

Meanwhile, other income stood at Rs 41 crore, compared with Rs 15 crore last year. This included a one-time interest income of Rs 36 crore, which also contributed to the company's reported earnings growth.

Premium Beer Volumes Jump 38 Per Cent; South and West Drive Growth

One of the key developments during the quarter was the growth in the premium beer segment. While overall sales volumes increased 16 per cent, premium beer volumes rose 38 per cent, indicating a faster pace of growth in the company's premium portfolio.

Regionally, South India recorded the highest volume growth at 24 per cent, supported by Karnataka, Kerala, Tamil Nadu and Andhra Pradesh. The company also focused on increasing its market share in states offering relatively better profitability, particularly Karnataka.

The West region followed with volume growth of 21 per cent, driven by Maharashtra, Madhya Pradesh, Chhattisgarh and Daman.

Meanwhile, North India reported 10 per cent volume growth, as higher sales in Rajasthan, Uttar Pradesh and Punjab were partially offset by a decline in Haryana.

The East region recorded 7 per cent growth, supported by Odisha, Arunachal Pradesh, Jharkhand and West Bengal, although volumes declined in Assam.

Overall, the regional performance showed that southern and western markets contributed significantly to the company's volume growth during the quarter.

H1 FY27: Revenue Rises 14 Per Cent, Net Profit Increases 31 Per Cent

The improvement in quarterly performance was also reflected in United Breweries' financial results for the first half of FY27.

For the six months ended September 30, 2026, the company reported net sales of Rs 5,601 crore, compared with Rs 4,914 crore in the corresponding period last year, representing growth of 14 per cent.

EBITDA increased 36 per cent to Rs 635 crore from Rs 467 crore, while profit after Tax rose 31 per cent to Rs 302 crore from Rs 231 crore.

In terms of business volumes, overall sales increased 12 per cent during the first half, while premium volumes grew 20 per cent. Gross margin stood at 42.7 per cent, improving marginally by four basis points year-on-year.

At the same time, EBITDA margin expanded to 11.3 per cent from 9.5 per cent, while EBIT margin improved by 129 basis points to 8.2 per cent.

The company's revenue analysis for H1 FY27 showed that higher sales volumes contributed Rs 590 crore to revenue growth, while favourable pricing and product mix added another Rs 276 crore. However, changes in its operating model reduced revenue by Rs 178 crore, primarily due to the increased contribution from contract brewery units.

Despite this impact, the combined contribution from higher volumes, premiumisation and pricing initiatives supported revenue growth during the six-month period.

Higher Fuel Costs and Operating Expenses Remain a Challenge

Although United Breweries reported an improvement in profitability, the company continued to face cost pressures during the first half of FY27.

According to its investor presentation, the Middle East conflict contributed to higher operating costs, particularly fuel-related expenses. However, improved pricing, a favourable product mix and productivity measures helped offset part of these additional costs.

During H1 FY27, employee expenses increased to Rs 420 crore from Rs 383 crore, while other expenses rose to Rs 1,428 crore from Rs 1,272 crore.

Despite the increase in expenditure, EBIT rose by Rs 120 crore to Rs 460 crore from Rs 340 crore in the corresponding period last year. The improvement was primarily supported by additional gross profit from higher sales volumes, although rising operating expenses partially offset these gains.

Business Developments: Focus on Premiumisation, Distribution and Productivity

Looking beyond the quarterly financial performance, United Breweries continues to focus on expanding its presence across mainstream and premium beer categories, improving product availability and strengthening its distribution network.

The company has also identified supply chain capabilities, operational productivity and organisational development as important areas of its business strategy.

Premiumisation remains an important part of its growth strategy, as reflected in the 38 per cent increase in premium beer volumes during Q2 FY27, compared with 16 per cent growth in overall volumes.

Alongside this, the company continues to focus on pricing initiatives, geographic mix and cost management to manage higher operating expenses and changes in its production arrangements.

The Q2 FY27 performance reflected higher sales volumes, faster growth in premium beer sales and an improvement in operating margins. These developments, along with the sharp increase in quarterly net profit, coincided with the strong buying interest witnessed in United Breweries shares during Wednesday's trading session.

Disclaimer: The article is for informational purposes only and not investment advice.