The target implies an upside potential of 25% from current market levels. The company is among the top five spirit players in India and now a formidable player in two of the largest sub-segments of IMFL – whisky and brandy, which account for 65% and 20% of the industry, respectively.
The company’s portfolio includes flagship brands such as Mansion House, a leader in brandy, and Imperial Blue, the second and third largest brands in the lower prestige and overall IMFL segment.
Here are 4 reasons behind the bullish call
1.) Big bet on premiumisation – To extend its growth runway, TIL has focused on expanding its presence in the IMFL category, particularly in the large whisky segment and the fast-growing white spirits segment. The acquisition of Imperial Blue marks its entry into the lower prestige and above segment, while its strategic investment in Spaceman Spirits strengthens its play in white spirits.
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These moves have helped diversify both its portfolio and geographic footprint. Whisky now contributes 67% to the portfolio compared to less than 10% earlier, while the share of non-South markets has increased to 50% from just 7% previously, significantly expanding its total addressable market.
More importantly, this broader portfolio, increased scale and improved regional mix provide a strong foundation to accelerate its premiumisation journey.
2.) Stable legacy business – Its journey over the past two decades has been marked by sharp swings. After a strong growth phase between FY04 and FY14, the company faced significant challenges in FY15–16, leading to a spike in debt and subsequent restructuring. This was followed by a period of operational stabilisation from FY17 to FY21, and then a successful fund raise between FY22 and FY25, which supported further debt reduction as well as growth investments. Over FY20–25, TIL delivered a sales CAGR of 16.6%, with volumes growing at 13.1%.
Looking ahead, the company is well placed to sustain momentum, supported by strong brands and a leadership position in key brandy markets, along with increased innovation in the prestige and above segment. Sales from the legacy business are expected to grow at a CAGR of 13.1% over FY26–28E, driven by volume growth of around 11%.
3.) Imperial Blue acquisition bodes well – As part of its portfolio expansion strategy, it acquired Imperial Blue, the second-largest brand in the lower prestige segment, from Pernod Ricard in November 2025 for a consideration of around EUR 413 million (approximately Rs 4,250 crore).
With estimated volumes of about 22 million cases, sales of Rs 2,800–3,000 crore and EBITDA of Rs 320–360 crore for FY25–26E, Imperial Blue is 1.6 to 1.9 times the size of TIL’s legacy business across volume, sales and EBITDA. Following the acquisition, the combined entity is expected to have volumes of around 35 million cases and sales of Rs 4,450 crore in FY26E. This would place TIL among the top five spirits players in the domestic market, with a high single-digit market share in the IMFL segment.
4.) Imperial Blue to help in volume growth – Following a sustained period of underperformance, Imperial Blue under Tilaknagar is set to become a focus brand and a key driver of its premiumisation strategy within the IMFL segment. The company expects a revival in volume growth, supported by increased brand investments, including a dedicated branding team.
Growth is also likely to be aided by stronger geographic synergies, with plans to scale up presence in key markets such as Kerala, Karnataka, Andhra Pradesh and Odisha, along with a potential entry into the CSD channel where it already has a strong foothold. Early signs of recovery are already visible in the traction seen in December, with management guiding for high single-digit volume growth in Q4 FY26.
The brokerage believes the company has the right ingredients to capitalize on the large and attractive opportunity in the Indian IMFL space, supported by strong brands, integrated manufacturing capabilities and a capable, professionally managed leadership team.
Going ahead, key factors to watch will be the acceleration in the prestige and above segment, driven by a revival in Imperial Blue, scale-up of Spaceman Spirits and continued innovation in the mid to upper prestige and luxury IMFL segments. Effective execution across these areas can enhance profitability, strengthen the balance sheet and unlock significant value over the medium to long term.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)