Volume concerns to weigh on United Breweries

Regulatory pressure adds to the stock’s poor performance

- RAM PRASAD SAHU

‘The stock of the country’s largest beer maker, United Breweries (UBL), is trading at 25-month lows given multiple headwinds related to volumes, regulatory issues, and margin trajectory.

After a muted second quarter (July-September) of 2025-26 (Q2FY26), brokerages also expect the company’s Q3FY26 performance to be underwhelming. At the current price, the stock is trading at 71 times its FY27 earnings estimates.

Kotak Research expects near-term growth and margin outlook to remain challenging, with volumes expected to fall in Q3FY26 for the alcoholic beverage major. The other negatives for the company are regulatory pressures and adverse operating leverage, an unfavourable state mix, and continued growth-oriented investment. Affordability issues on the back of regulatory headwinds are also weighing on growth, it adds. The brokerage has a “sell” rating, with a target price of %1,500.