United Breweries Capital Markets Day: UBL Targets Profitable Growth as India’s Beer Market Enters a New Phase
United Breweries Ltd (UBL) outlined an ambitious medium-term growth strategy at its Capital Markets Day on September 3, 2026, positioning India’s beer market for a new phase of expansion driven by favourable demographics, rising incomes, premiumisation and improving affordability.
The company believes India remains significantly underpenetrated in beer, providing a substantial long-term opportunity for volume growth. UBL also sees considerable scope to improve profitability through premium products, productivity initiatives, supply-chain optimisation and a better state-wise business mix.
India’s Beer Market Offers Significant Headroom
UBL highlighted several structural factors supporting long-term beer consumption in India.
India has a population of around 1.46 billion, with roughly two-thirds below the age of 35. Beer consumption per capita remains low at approximately 2.5 litres, compared with around 25 litres globally.
At the same time, India is expected to remain one of the world’s fastest-growing major economies, with rising household incomes and urbanisation creating a larger addressable consumer base.
UBL believes four major trends can drive beer consumption:
- Rising disposable incomes
- Increasing urbanisation
- A young legal-drinking-age consumer base
- Premiumisation and demand for differentiated products
The company also believes beer remains relatively less affordable than spirits in several markets because of the taxation structure, creating an opportunity for policy reforms to improve affordability and expand consumption.
State-Level Policy Reforms Can Unlock Growth
UBL highlighted recent reforms in Maharashtra, Jharkhand and Karnataka as examples of how changes in taxation and retail regulations can accelerate beer-market growth.
In Maharashtra, changes in the duty structure helped narrow the affordability gap between beer and spirits. UBL estimates that the beer category grew 35% in H1 2026.
In Jharkhand, retail liberalisation improved product availability, with the company reporting 55% category growth in H1 2026.
Karnataka’s introduction of an alcohol-in-beverage-based duty structure reduced the effective tax burden and supported affordability. UBL reported 55% category growth in the first month following the reform.
The company is therefore advocating three key policy priorities: better affordability, improved availability and greater consumer awareness.
Kingfisher Remains Central to UBL’s Growth Strategy
UBL intends to strengthen its leadership across mainstream and premium segments.
Its strategy includes:
- Strengthening Kingfisher in mainstream beer
- Expanding premium brands
- Building regional brands or “Local Jewels”
- Increasing the presence of international premium brands
- Developing new consumption occasions and categories
The company reported strong recent growth across several brands. Heineken Silver grew 28% in the latest quarter, while Heineken 0.0 grew 16% in FY2025. Water business growth was also highlighted as another opportunity beyond traditional beer.
UBL said premium beer is growing significantly faster than the overall category, making premiumisation one of the most important drivers of future growth and profitability.
Premiumisation Could Become a Major Margin Driver
Premium volumes have been growing faster than total industry volumes.
UBL highlighted that premium category growth was approximately 2.8 times faster than overall category growth between 2022 and 2025.
The company also reported that premium gross margins became significantly more attractive in H1 2026, with gross margin expanding by more than 1,000 basis points compared with H1 2025.
However, UBL believes the opportunity is still underdeveloped because premium products are currently margin-accretive in only around 60% of its markets.
This gives the company an opportunity to improve profitability through:
- Higher premium penetration
- Localisation of supplies
- Greater production scale
- Better trade-spend allocation
- Improving the state mix
Supply Chain and Capex to Support Future Growth
UBL plans to use its extensive production network to support the next phase of growth.
The company currently operates 17 own breweries and works with 18 co-packers, providing a flexible supply network.
UBL said it has added eight contract brewing units over the last two years and has three capex projects planned for 2026–27.
The company is also increasing premium production capability, localising procurement and working with strategic suppliers to reduce logistics and import costs.
A major focus is improving production efficiency brewery by brewery while ensuring sufficient capacity for future demand.
Productivity Programme to Drive EBITDA Expansion
UBL is targeting structural margin improvement through productivity initiatives across its value chain.
Key initiatives include:
- Increasing bottle collection and reuse
- Localising production
- Local sourcing of malt and bottles
- Long-term supplier agreements
- Reducing import and transportation costs
- Optimising sourcing and product portfolios
- Better trade-spend allocation
- Improving operational leverage
UBL said 100% local sourcing of malt and bottles is targeted for 2026.
The company also reported a 20% reduction in trade-spend allocation in the latest quarter, while its Project Genie pilot improved bottle collection by 9%.
Mid-Term EBITDA Margin Ambition
One of the most important takeaways for investors is UBL’s margin ambition.
The company currently sees a pathway to move EBITDA margins from the high-single-digit range towards the low-teens and potentially mid-teens over the medium term.
The improvement is expected to come from three principal areas:
State mix + Portfolio mix + Productivity
UBL intends to focus investments on higher-margin states while improving margins in lower-margin markets.
The company is aiming to balance revenue growth with margin expansion and ultimately deliver sustainable EPS compounding, stronger cash flows and improving ROIC.
HEINEKEN Sees India as a Major Global Growth Engine
HEINEKEN’s participation in the Capital Markets Day reinforces the strategic importance of India within its global portfolio.
HEINEKEN identified India as one of its key growth markets and expects the country to be among the largest contributors to volume growth across its focus markets between 2026 and 2030.
India is also expected to rank among HEINEKEN’s top three global premium growth engines during the period.
The global brewer said UBL’s position provides an attractive combination of global brands, local market knowledge and a strong distribution network.
HEINEKEN’s global EverGreen 2030 strategy focuses on three broad priorities:
- Accelerate growth
- Step up productivity
- Build a future-fit organisation
For India, this translates into premiumisation, mainstream brand growth, supply-chain productivity and greater use of HEINEKEN’s global capabilities.
Long-Term Value Creation Targets
UBL’s medium-term strategy is not focused solely on volume growth. The company wants to deliver balanced growth with improving profitability and shareholder returns.
Its key ambitions include:
- Organic net sales growth
- Volume, pricing and mix-led growth
- EBITDA and EPS growth
- Improving cash flows
- Improving ROIC
- Water usage below 2.6 hl/hl
- Net-zero Scope 1 and 2 emissions by 2030
- 40% women representation in senior management
UBL is also targeting a more efficient operating model through an appropriate balance between owned and contract brewing.
Points to consider
The key message from UBL’s Capital Markets Day is that the company sees India’s beer market as a long-term structural growth opportunity rather than simply a cyclical consumption story.
For investors, the most important opportunity lies in the combination of volume growth and margin expansion.
India’s low beer penetration provides room for category expansion, while premiumisation can improve the revenue and profitability mix. At the same time, UBL’s productivity programme, local sourcing, supply-chain optimisation and state-level strategy could provide additional EBITDA leverage.
The company’s ability to convert these opportunities into sustainable earnings growth will depend on regulatory reforms, consumer affordability, premiumisation, execution, commodity costs and successful productivity initiatives.
With HEINEKEN identifying India as a major global growth market, UBL is positioning itself to lead the next phase of India’s beer-market expansion while targeting a significant improvement in profitability and shareholder returns.
Disclaimer
This article is based on information presented by United Breweries Limited (UBL) during its Capital Markets Day held in September 2026. The information has been summarised and interpreted for informational and educational purposes only.
The views, estimates, growth opportunities, financial targets and forward-looking statements mentioned in the article are subject to various risks and uncertainties, including changes in consumer demand, taxation and regulations, commodity prices, raw-material costs, economic conditions, competition, government policies and other factors that may cause actual results to differ materially from expectations.
This article should not be considered investment advice, a recommendation to buy or sell any security, or a guarantee of future performance. Investors should conduct their own research and consult a qualified financial adviser before making any investment decision.