USL expects fast recovery in sales as states lift restrictions

Bengaluru, 5 February Liquor major United Spirits Ltd (USL) is hopeful of a quick recovery in sales as the Omicron wave has started to recede in the country.

In the post earnings call, the company said the new COVID wave had impacted its sales like the past waves.

"In some states, weekend closures and night curfews have impacted footfalls but like before in the previous wave, we expect that the recovery will come quite fast," Managing Director of USL, Hina Nagarajan said in the analysts' call.

"We expect normalisation to come in very fast as these restrictions go away," she added.

USL's net sales of 'Prestige & Above' segment increased 20 per cent with strong double-digit growth in its scotch portfolio during the quarter ended December, 2021.

Its parent Diageo had said that Indian business grew 12 per cent between July-December driven by strong consumer demand in the off-trade channel, recovery of the on-trade channel and strong premiumisation.

Since the beginning of the pandemic in 2020, liquor sales had seen severe disruptions due to closure of bars and restaurants apart from social distancing measures.

USL management highlighted the need for lowering tax on liquor products owing to such disruption.

"Our hope is actually that the governments will understand that it is a very extraordinary year in terms of inflation and we continue to represent pricing through the association," said Nagarajan.

Most liquor and soft drink companies are expecting this summer to be very good season for sales as many states lift restrictions on bars and restaurants with falling COVID cases.