United Spirits Stock Surges Amid Rumors of Diageo Selling RCB Stake
Stock Surge and Rumors
On June 10, shares of United Spirits saw a notable increase of 3%, marking the highest rise in five months. This surge coincided with circulating rumors that Diageo, the parent company, might be considering selling its stake in the Royal Challengers Bengaluru, the IPL 2025 champions. Reports suggested that Diageo was eyeing a valuation of ₹17,000 crore for the franchise.
Clarification from United Spirits
However, the stock's upward trend was short-lived. United Spirits promptly issued a statement to the stock exchange, refuting the rumors and labeling them as "speculative." The company confirmed that there had been no discussions regarding the sale of any stake in RCB.
Official Statement
"The company would like to clarify that aforesaid media reports are speculative in nature and it is not pursuing any such discussions."
Origins of the Speculation
The rumors gained traction following RCB's first IPL title win this season. Since Diageo took over after Vijay Mallya's financial troubles, many fans speculated whether the company was now looking to sell the team for a substantial profit.
Tragic Incident and Its Impact
Compounding the rumors was a tragic event during the RCB victory parade at Chinnaswamy Stadium, where a stampede resulted in 11 fatalities and over 50 injuries. This incident led to increased scrutiny of RCB, the police, and event organizers, prompting questions about the franchise's management and future.
Financial Performance
Following the denial of the rumors, United Spirits' stock began to recover, buoyed by a strong quarterly performance. The company reported a 74.7% increase in net profits, reaching ₹421 crore, with revenues climbing 8.9% to ₹3,031 crore. EBITDA also saw a significant rise of 37.7%, totaling ₹460 crore, alongside the announcement of a final dividend of ₹8 per share.
Future Prospects
The pressing question remains: if Diageo is not planning to sell, what sparked these rumors? Additionally, after securing their first IPL trophy, will RCB's value and reputation continue to grow? For now, United Spirits maintains that "There is no deal going on," but the dynamic nature of the IPL and cricket franchises often leads to rapid changes.