Associated Alcohols Q4 FY26 IMFL Volume Up 37%

Associated Alcohols & Breweries Limited Q4 and FY26 Earnings Conference Call Summary

Management Participants

• Mr. Anshuman Kedia – Whole-Time Director and Chief Executive Officer
• Mr. Tushar Bhandari – Whole-Time Director
• Mr. Dilip Kumar Inani – Chief Financial Officer
• Moderator: Ms. Riddhi Shah – Go India Advisors

Financial Performance Q4 FY26

• Net Revenue: INR 239 crores
• EBITDA: INR 40 crores (13% YoY growth)
• EBITDA Margin: 17% (200 bps YoY expansion)
• PAT: INR 24 crores (5% YoY growth)
• PAT Margin: 10%

Segmental Performance Q4 FY26

Proprietary IMFL Business:

• Volume: 6.6 lakh cases (37% YoY growth)
• Revenue: INR 50 crores (38% YoY growth)
• EBITDA Margin: 22% (highest ever quarterly margin)

IMIL Business:

• Volume: 9.8 lakh cases
• Revenue: INR 62 crores (7% YoY growth)
• EBITDA Margin: 20%

Ethanol Business:

• Volume: 4 million liters (35% YoY decline)
• Revenue: INR 24 crores
• EBITDA Margin: 10%
• Decline due to industry oversupply and reduced government allocation

Merchant ENA Business:

• Volume: 6.9 million liters (129% YoY growth)
• Revenue: INR 47 crores (128% YoY growth)
• EBITDA Margin: 14%
• Enhanced production to 50 million liters from 47 million liters through improved plant efficiencies

Strategic Business Updates

Market Expansion & Performance:

• Entered new markets including Maharashtra, Uttar Pradesh, and Odisha
• Gained 1.5% market share in Kerala, becoming third largest private player
• Present across 14 states, targeting entry into Andhra Pradesh and Karnataka
• Central Province portfolio grew 28% YoY
• Orange CP Vodka achieved 25% market share in Madhya Pradesh within 6 months of launch

Acquisition:

• Acquired SDF Industries Limited (distillery-cum-bottling unit) in Kerala on 16th April 2026 for INR 30 crores
• Additional INR 10 crores capex planned for plant modernization and automation
• Strategic location in central Kerala for better distribution

Product Launches & Pipeline:

• Soft launched RTD product 'Kultur' in Madhya Pradesh (5 flavors, 8% alcohol, INR 130 MRP for 300ml can)
• Brandy and tequila planned for launch in H1 FY27 (tequila delayed due to shipment issues)
• Commissioned 6,000 KLPD malt facility for single malt whiskey production
• Single malt whiskey launch planned for H2 FY28 with two price points (affordable and premium)

Business Model Transition:

• Inbrew business transitioned from IMFL licensing agreement to contract manufacturing model
• Impacted overall top line growth which remained flattish

Operational Highlights

• Enhanced ENA production capacity through improved operational efficiencies
• Focus on backward integration and scaling proprietary IMFL portfolio
• Target: Increase proprietary IMFL contribution to 50% of top line (excluding ethanol) in 3-5 years

FY27 Guidance

• Revenue Growth: 10%+ overall, with 25-30% growth in proprietary IMFL business
• EBITDA Margin: ~15%
• Marketing expenses expected to increase to ~10% with premium product launches

FY28 Outlook

• Higher growth expected with single malt whiskey launch
• Revenue growth around 15% from FY28 onwards
• Margin improvement expected from FY29 as premium products scale

Market Challenges

• Ethanol industry facing oversupply issues
• Packaging material cost increase (PET bottles, paper, aluminum) due to geopolitical situation
• Transportation cost pressure if petrol prices increase substantially
• Mitigation through value engineering and EDP increases

Kerala Market Strategy

• Current market share: 7.3%
• Target: 2 million cases annually (from 1.6-1.7 million)
• SDF acquisition to address manufacturing challenges and improve supply stability

Product Performance Details

• Nicobar: ~2,000 cases in FY26
• Hillfort: ~4,000 cases in FY26
• Central Province series remains portfolio leader

Digital Presence

• All products available on Meta platforms (Instagram, Facebook)
• CP portfolio has ~60,000 followers
• Plans for increased digital marketing with influencer partnerships