United Spirits lifts ad spend 57% for festive season

United Spirits Limited has answered a familiar question for brand leaders: do you keep advertising when the quarter turns soft? In Q2 FY27, the spirits major raised advertising and promotion spending by 57% to ₹378 crore, up from ₹241 crore a year earlier. That lifted its A&P re-investment rate to 11.6% of net sales value, from 7.6%.

01 · A deliberate pre-festive push

The company described the jump as “healthy investments behind the brands and new launches ahead of the festive season.” For the first half of FY27, marketing spends reached ₹690 crore, against ₹479 crore in the year-ago period, also 11.6% of NSV.

02 · What the P&L absorbed

Net sales value rose 2.8% to ₹3,258 crore. Profit after tax slipped 2.1% to ₹462 crore, producing a net margin of 14.2%. Volumes fell 5.0% to 15.77 million cases, though price and mix offset the volume decline. Gross profit grew 4.7% to ₹1,563 crore and gross margin expanded 88 bps to 48.0%, helped by better mix and productivity and partly offset by the West Asia crisis.

EBITDA declined 4.3% to ₹643 crore, and EBITDA margin contracted 146 bps to 19.7%. The Popular segment felt regulatory heat: policy changes in Maharashtra and Karnataka and excise slab shifts in Karnataka pushed that segment down 22.7% like-for-like to ₹181 crore.

03 · Premium did the heavy lifting

Prestige & Above NSV grew 6.3% to ₹3,065 crore and now accounts for 94.1% of NSV. The growth came from Smirnoff’s local flavour innovation, the J&B Scotch relaunch and the luxury portfolio. The company also reclassified McDowell’s No.1 brandy from Popular to P&A; excluding brandy, P&A value growth was 6.5%.

A quick read of the quarter:

• A&P spend: ₹378 crore, up 57% year-on-year; 11.6% of NSV.
• Prestige & Above NSV: ₹3,065 crore, up 6.3%; 94.1% of NSV.
• Popular NSV: ₹181 crore, down 22.7% like-for-like.
• H1 FY27 marketing spend: ₹690 crore, against ₹479 crore a year earlier.

04 · What the leadership is betting on

CEO Praveen Someshwar called it “a resilient quarter despite a strong prior-year base and regulatory headwinds.” The company is using the J&B relaunch, enabled by the India-UK FTA, to “recruit and deepen Scotch penetration,” and has entered ready-to-drink with Smirnoff Ice.

For marketing teams, the lesson is not to spend blindly. It is to keep building premium and launchable assets, and let price, mix and productivity carry the margin when volumes are soft. That is exactly the trade United Spirits made this quarter.

Source: Indian Advertising Media & Marketing News – exchange4media

Mad About Marketing Desk The strategists and writers at Mad About Marketing, writing up what we see in the work every week.