Key Quantitative Figures

  • Total Long Term Bank Facilities: ₹56.50 crore (reduced from ₹98.80 crore)
  • Financial Performance FY26:
  • Total Operating Income: ₹216.59 crore (down ~14% from ₹252.00 crore in FY25)
  • PBILDT: ₹13.58 crore
  • PBILDT Margin: 6.27% (up from 3.47% in FY25)
  • Profit After Tax (PAT): ₹4.39 crore
  • Total Debt (as of March 31, 2026): ₹93.26 crore (up from ₹66.14 crore)
  • Net Worth (as of March 31, 2026): Negative ₹10.36 crore (improved from negative ₹14.80 crore)
  • Overall Gearing: Negative 5.98x
  • Interest Coverage: 4.37x (improved from 0.77x)
  • Q1 FY27 (Unaudited):
  • Total Operating Income: ₹53.04 crore
  • PBILDT: ₹5.42 crore
  • PAT: ₹2.42 crore
  • Capacity Utilization:
  • FY26: 60.47%
  • 5MFY27: 73.07%

Debt Restructuring History & Current Obligations

The company underwent a One Time Settlement (OTS) process for outstanding debt with multiple banks. All dues to Punjab National Bank, Indian Bank, Allahabad Bank, State Bank of India, and IFCI Ltd were fully settled by March 2023, with No Dues Certificates received.

A separate OTS with Meghalaya Industrial Development Corporation (MIDCL) for ₹61.94 crore was approved on December 11, 2024. The original repayment deadline was extended multiple times. Under the latest revised terms approved on August 10, 2026 (retrospectively):

  • ₹29.00 crore was due by August 31, 2026
  • ₹9.00 crore is due by February 2027

The company repaid ₹29.00 crore on August 28, 2026. This was funded through a ₹25.00 crore term loan from Kotak Mahindra Bank, a ₹5.00 crore unsecured loan from promoters, a ₹1.00 crore ICD from Asgard Alcobev Limited, and internal cash accruals.

For FY27, the total debt repayment obligation is approximately ₹52.37 crore (includes the remaining MIDCL OTS amount). The company had already paid ~₹42.85 crore as of the report date. The balance is expected to be met through cash accruals and fresh term loan/equity infusion.

Ownership and Structural Change

On December 17, 2025, Mr. Ronak Jain (promoter of CMJ Breweries) acquired promoter control of Asgard Alcobev Limited (BSE-listed entity). Subsequently, Asgard Alcobev Limited acquired approximately 78% shareholding in CMJ Breweries Private Limited through a share-swap transaction completed on February 17, 2026. This was followed by a mandatory open offer under SEBI SAST Regulations, concluded in May 2026, and a preferential allotment. Consequently, CMJ Breweries became a subsidiary of Asgard Alcobev Limited.

A promoter-funded unsecured loan of ₹20.00 crore is proposed to be converted into equity, with an application submitted and implementation expected by October 2026.

Rating Action and Rationale

CARE Ratings reaffirmed the long-term bank facilities rating of CMJ Breweries at 'CARE B-' with a 'Stable' outlook on October 07, 2026.

Key Rating Constraints (Weaknesses):

  • Past debt restructuring (SDR application in FY17, OTS in 2019 and 2022)
  • Weak profitability and leveraged capital structure with negative net worth
  • Ongoing debt-funded capex
  • Stretched liquidity position
  • Changes in government regulations impacting the spirit industry
  • Volatility in raw material prices with limited pricing power
  • Highly regulated nature of alcohol industry

Key Rating Strengths:

  • Modest track record of operations
  • Association with leading brands (Asia 72, Heman 9000, Kingfisher, Magpie, Savage, Carlsberg)
  • Improvement in capacity utilization post-modernization (brewery division)
  • High entry barriers in liquor industry
  • Structural change following acquisition by Asgard Alcobev Limited

Rating Sensitivities

Positive factors:

  • Equity infusion leading to shoring up of net worth and easing of liquidity
  • Ramp up in scale of operations beyond ₹300 crores with PBILDT margins above 10% on sustained basis
  • Improved capital structure with overall gearing less than 1.50x on sustained basis

Negative factors:

  • Delay in timely infusion of funds from promoters in case of requirement
  • Moderation in interest coverage below 2.5x on sustained basis

Liquidity Assessment

Liquidity remains stretched, as indicated by a low current ratio, moderate quick ratio, and moderate cash accruals against high debt repayments.

Facilities Details

The rated long-term bank facilities (₹56.50 crore) comprise:

  • LT-Cash Credit: ₹10.00 crore (CARE B-; Stable)
  • LT-Term Loan: ₹9.00 crore (Maturity: February 28, 2027; CARE B-; Stable)
  • LT-Term Loan: ₹37.50 crore (Maturity: September 28, 2026; CARE B-; Stable)

All facilities are under RBI regulation and have a 'Simple' complexity level.