United Spirits wins CESTAT case, ₹141 crore excise duty and penalty dropped – CNBC TV18

Diageo-controlled liquor maker United Spirits Ltd on Tuesday (March 3) said it has received a favourable order from the Custom, Excise & Service Tax Appellate Tribunal (CESTAT). The order, dated June 9, 2025, relating to financial years 1997-2005, was received by the company on March 2, 2026, at 10:10 PM IST.

The Tribunal upheld the valuation methodology followed by the company and held that the royalty received from Contract Bottling Units (CBUs) has no connection with the price of food flavours sold to them. As a result, the entire excise duty demand raised against the company stands deleted.

The excise duty demand, including central excise duty of ₹79.80 crore plus applicable interest and penalty of ₹60.70 crore, has been dropped. The company said the favourable order has no impact on its financial, operational, or other activities.

Also Read: United Spirits Q2 Results: Beats estimates across the board, profit up 36% YoY

Third Quarter Results

The spirits maker posted a net profit of ₹529 crore for the quarter, higher than the CNBC-TV18 poll estimate of ₹497 crore. Revenue stood at ₹3,683 crore, marginally ahead of the estimate of ₹3,650 crore. However, EBITDA at ₹618 crore missed estimates of ₹640 crore, while margins declined to 16.8% compared with the poll expectation of 17.5%.

On a year-on-year basis, net profit rose 11.8% from ₹473 crore, while revenue increased 7.3% from ₹3,432 crore. EBITDA grew 5.1% year-on-year, though margins softened from 17.1% in the same quarter last year. Net sales value (NSV) for Q3FY26 came in at ₹3,694 crore, marking a growth of 7.6%. Growth was driven primarily by the Prestige & Above (P&A) segment, which recorded NSV growth of 8.2% during the quarter.

United Spirits said overall NSV growth was partly offset by adverse policy-led impacts in Maharashtra and the absence of a one-time retail pipeline fill in Andhra Pradesh in the year-ago period. The Popular segment saw NSV decline 4.6% during the quarter, largely due to the Maharashtra impact.

Also Read: United Spirits aims for double-digit growth over five years through premiumisation

For the first nine months of FY26, the Prestige & Above segment accounted for 89.4% of total net sales value, up 0.7 percentage points year-on-year, with segment NSV rising 9.8%. The Popular segment accounted for 9.0% of net sales during the period.

On Monday (March 2), shares of United Spirits Ltd ended at ₹1,373.25, down by ₹9.95, or 0.72%, on the BSE.

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