United Spirits Limited reported a robust financial performance for the year ended March 31, 2026, with the Board of Directors approving the audited standalone and consolidated financial results at its meeting held on May 14, 2026. The board recommended a final dividend of ₹11 per equity share (550% on face value of ₹2 per equity share) for FY 2025-26, subject to shareholders' approval at the 27th Annual General Meeting scheduled for August 4, 2026. The record date for determining shareholder entitlement has been fixed as July 8, 2026, with the dividend to be paid on or after August 13, 2026. The recording of the investors' call held on May 15, 2026, is now available on the company's website.

Management Outlook and Cost Guidance

Management has flagged near-term margin headwinds stemming from rising input costs. Packaging costs are expected to rise by 4% to 5% in Q1, causing a gross margin decrease of 1.25% to 1.5%, equivalent to approximately ₹35-40 crores. Management cautioned that this impact could double in Q2 if the cost pressures persist. To mitigate inflationary pressures, management plans to address 50% of the impact through pricing actions and the remaining 50% through productivity improvements, while acknowledging that price changes generally take time to implement.

On the growth front, management expects strong double-digit growth in Karnataka, supported by pricing strategies and the strong performance from the prior year. The company also expects strong double-digit growth for its Prestige & Above (P&A) portfolio in FY27, despite headwinds from Maharashtra and Andhra Pradesh. United Spirits achieved its EBITDA margin guidance of 18.4% in FY26, and Smirnoff is projected to hit ₹1,000 crores in Net Sales Value within 18 months. The dividend payout ratio has been updated to a range of 60% to 85%, while advertising and promotions (A&P) spending remains at approximately 10.5%.

Standalone Financial Performance

United Spirits posted a strong improvement in standalone profitability for the year ended March 31, 2026. Revenue from operations grew to ₹27,781 crores from ₹26,780 crores in the previous year. Net profit for the year rose to ₹1,830 crores from ₹1,558 crores, while basic and diluted earnings per share stood at ₹25.16 compared to ₹21.42 in the prior year.

Q4 Standalone Performance

For the quarter ended March 31, 2026, United Spirits delivered a strong year-on-year improvement across key standalone metrics. Revenue from operations rose to ₹6,838 crores from ₹6,549 crores in the corresponding quarter of the prior year, while net profit climbed to ₹571 crores versus ₹451 crores. EBITDA for the quarter expanded to ₹6b Rupees from ₹5.05b Rupees in the same period last year, with the EBITDA margin improving to 8.64% from 7.71%.

Consolidated Financial Performance

On a consolidated basis, United Spirits reported revenue from operations of ₹27,816 crores for FY26, up from ₹26,780 crores in FY25. Net profit for the year (including discontinued operations) was ₹1,838 crores compared to ₹1,582 crores in the prior year. Profit from continuing operations stood at ₹1,709 crores for FY26 versus ₹1,445 crores in FY25, while profit from discontinued operations was ₹129 crores compared to ₹137 crores.

United Spirits Limited has filed a disclosure under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, informing stock exchanges of a significant litigation development involving a water charges demand of INR 441.95 crore raised by the Water Resources Department (WRD), Government of Maharashtra. The disclosure was made on 17th May 2026 and signed by Pragya Kaul, Company Secretary and Compliance Officer.

Background and Demand Details

The matter has a prior history, with earlier stock exchange intimations dated 15th August 2023, 21st May 2024, and 1st October 2025. Pursuant to directions of the Bombay High Court vide its order dated 26th September 2025, the WRD issued a letter dated 20th March 2026 (received on 24th March 2026) to the company. The letter computed the total amount payable within 30 days towards water charges for the period November 2018 to February 2026, after accounting for adjustments.

The key financial parameters of the demand are summarised below:

Company's Objections to the Demand

United Spirits raised several procedural and substantive objections to the demand. The company stated that the WRD did not comply with the High Court's directions to ensure adherence to the Principles of Natural Justice. Specifically, the company was not granted a hearing, and the WRD failed to consider the material placed on record by the company. Additionally, the WRD did not provide a copy of its purported study on which the computation of the demand was based.

On these grounds, the company challenged the demand by filing a Writ Petition before the Bombay High Court, contending that the demand letter and the basis of its computation were contrary to and in violation of the earlier judgment dated 26th September 2025.

Judicial Proceedings and Interim Relief

The Bombay High Court, vide its order dated 5th May 2026, issued notices to the respondents. However, no ad-interim protection was granted to the company, and the writ petition remains pending adjudication. Given this development, the company, based on advice from external counsel, filed a Special Leave Petition (SLP) before the Hon'ble Supreme Court of India seeking interim protection against any coercive action by the WRD.

The timeline of key judicial events is as follows:

By its order dated 12th May 2026, the Supreme Court granted four weeks to USL to deposit INR 50 Crore with the Court—and not with the WRD—as an interim measure. During this period, the WRD is restrained from taking any coercive action against USL.

Expected Financial Impact

The opposing parties in this matter include the State of Maharashtra, the Maharashtra Water Resources Regulatory Authority (MWRRA), the Water Resources Department (WRD), the Sub-Divisional Engineer (WRD), and the Executive Engineer (WRD). Based on its risk assessment process, United Spirits stated that it believes it has a good case on merits and accordingly does not expect any material financial implications from this litigation.