Are Allied Blenders & Distillers Ltd latest results good or bad?

Allied Blenders & Distillers Ltd reported its Q2 FY26 results, showcasing significant operational trends. The company achieved a net profit of ₹64.31 crores, reflecting a year-on-year increase of 35.22%. Revenue for the quarter reached ₹990.06 crores, marking a 14.11% growth compared to the same period last year. This revenue figure represents the highest quarterly sales for the company, indicating robust demand across its premium brand portfolio, which includes Officer's Choice and Sterling Reserve.
The operating margin improved to 12.67%, up 76 basis points from the previous year, signaling effective cost management and operational efficiencies despite rising input costs. The return on equity (ROE) also showed improvement, reaching 12.63%, which suggests better capital deployment by the company.

Sequentially, the company demonstrated strong momentum with a 13.70% increase in net profit compared to the previous quarter, alongside a 7.28% growth in net sales. This performance highlights the company's ability to navigate a competitive environment while continuing to expand its market presence.

However, the stock's valuation has come under scrutiny, as it trades at elevated multiples compared to historical norms and peers, leading to a revision in its evaluation. The company has made strides in reducing its long-term debt, which declined significantly, enhancing its financial flexibility. Overall, Allied Blenders is positioned well operationally, but the current valuation dynamics warrant careful consideration moving forward.