Exactly after a decade, United Spirits announced dividends to equity shareholders on improved cash flows. The spirit maker on Wednesday resumed dividend distribution and declared an interim dividend of ₹4 per share for the financial year 2024. The company has not declared any dividend from the financial year 2013-14 onwards.

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Notably, post-Q1 results, the Diageo-controlled liquor maker had signaled such a move as it could wipe out entire accumulated losses from the book. The company has wiped out its accumulated losses completely and started the new financial year on a positive note.

We would want to come out with a formal dividend distribution policy and we are working on a few scenarios, said Pradeep Jain, Chief Financial Officer (CFO) of the company, in an analyst call post-Q1 results.

"Hopefully, over the next three to four months, we will issue out a formal dividend distribution policy," added Jain.

According to Bloomberg data, United Spirits’ accumulated losses at the end of FY23 stood at ₹308 crore. In contrast, the company had an accumulated loss of ₹5,637 crore in FY15. Further, it has been reporting profits since FY16, resulting in wiping off accumulated losses from the book.

The operating margin of United Spirits came in at 16.4% for the September quarter, beating the CNBC-TV18 poll of 15.1%. Even the net revenue was better than expected at ₹2,865 crore. The analysts polled by CNBC-TV18 had pegged a net revenue of ₹2,731 crore for the quarter.

Sensing the robust set of numbers, shares of United Spirits climbed to their record high on Wednesday. The United Spirits share price added another 1.6% in Wednesday’s trade, taking year-to-date gains to over 25%. In comparison, the benchmark Nifty50 has gained 7.4% during the same period.

The declared interim dividend is 200% on equity, which has a par value of ₹2 per share.

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(Edited by : Ajay Vaishnav)

First Published:Nov 8, 2023 8:36 PM IST