💰 Financial Performance

Revenue Growth by Segment

FY25 Net Revenue reached INR 1,096.58 Cr, growing 43.4% YoY. IMFL Proprietary segment grew 35% YoY in Q2FY26 (INR 41 Cr) with volume growth of 37% (5.66 lakh cases). IMIL revenue grew 8% YoY to INR 56 Cr in Q2FY26. Ethanol revenue was INR 71 Cr and Merchant ENA contributed INR 37 Cr in Q2FY26.

Geographic Revenue Split

Primary revenue concentration is in Madhya Pradesh (MP), though the company is expanding into Kerala and other states. Realization in MP dropped 2% due to pricing policy changes, necessitating geographic diversification to reduce dependence.

Profitability Margins

FY25 Net Profit Margin was 7.4% (up 12% from 6.6% in FY24). Operating Profit Margin was 12.1% (up 7% from 11.3%). Q2FY26 Gross Margin stood at 36%, impacted by lower byproduct realization and raw material mix changes.

EBITDA Margin

FY25 EBITDA Margin was 12% (INR 128.09 Cr), up from 10% in FY24. However, Q2FY26 EBITDA margin dipped to 9% (INR 24 Cr) due to increased marketing costs for new state entries and lower byproduct prices.

Capital Expenditure

Property, Plant & Equipment (PPE) stood at INR 347.3 Cr in FY25, compared to INR 248.0 Cr in FY24. Capital Work in Progress (CWIP) was INR 32.0 Cr as of March 31, 2025.

Credit Rating & Borrowing

CRISIL monitors operating profitability sustaining at 12-13% for upward rating factors. Interest expense for FY25 was INR 5.7 Cr on total borrowings of INR 71.9 Cr (INR 19.6 Cr non-current and INR 52.3 Cr current).

⚙️ Operational Drivers

Raw Materials

Key raw materials include Grains (Maize and Rice), Coal for power/steam, Glass Bottles, and PET Resin. Grains and coal are the primary cost drivers for the distillery and ethanol operations.

Import Sources

Primarily domestic sourcing from Madhya Pradesh and surrounding regions for grains to support the integrated distillery operations.

Key Suppliers

Not disclosed in available documents, though the company maintains long-term strategic contracts for major inputs to stabilize costs.

Capacity Expansion

Current ENA manufacturing capacity is 40 MLPA. The facility houses 41 bottling lines with a collective annual capacity of 16 million cases. A new Ethanol plant became operational in February 2024.

Raw Material Costs

Total operating expenses for FY25 were INR 947.9 Cr. ENA production costs were impacted by a drastic drop in byproduct (DDGS) sale prices due to an increase in the number of ethanol plants nationally.

Manufacturing Efficiency

Inventory turnover ratio improved by 20% to 5.45x in FY25. Debtor turnover improved 3% to 29.5x, reflecting efficient working capital management.

Logistics & Distribution

Selling and distribution expenses are targeted at approximately 5% of the IMFL proprietary brand top line.

📈 Strategic Growth

Expected Growth Rate

10%

Growth Strategy

Growth will be driven by a 30-35% target in proprietary IMFL brands, premiumization (targeting 20%+ margins), and expansion into new geographies like Kerala. The company is launching new products in Brandy, Tequila, and Ready-to-Drink (RTD) segments.

Products & Services

Proprietary IMFL (Whisky, Brandy, Tequila, RTD), Licensed IMFL, India Made Indian Liquor (IMIL), Merchant ENA, and Ethanol.

Brand Portfolio

London Bridge (Proprietary), Bagpiper (Licensed), White Mischief (Licensed), CLR (Licensed), and DSP Black (Licensed). The company owns a total of 14 proprietary brands.

New Products/Services

Upcoming launches include Brandy, Tequila, and Ready-to-Drink (RTD) products, with premium offerings expected to attract 20%+ EBITDA margins.

Market Expansion

Expanding presence in premium segments and entering additional geographies like Kerala to reduce dependence on the Madhya Pradesh market.

Market Share & Ranking

Flagship company of the Kedia Group with a strong established market position in Madhya Pradesh over four decades.

Strategic Alliances

Contract manufacturing and licensing alliances with Diageo-USL and Inbrew. The merger with Mount Everest Breweries was called off due to regulatory delays.

🌍 External Factors

Industry Trends

The industry is seeing a shift toward premiumization and a government-led push for Ethanol blending (E20). However, it remains burdened by high state-level excise duties and marketing restrictions.

Competitive Landscape

Highly competitive market with national players and local distilleries; competition risk is mitigated through a diversified product portfolio (ENA to Premium IMFL).

Competitive Moat

Durable advantages include 40+ years of industry experience, an integrated manufacturing model (distillery to bottling), and long-standing relationships with global majors like Diageo for licensed manufacturing.

Macro Economic Sensitivity

Highly sensitive to grain (maize/rice) and coal inflation, which directly impacts the cost of ENA and Ethanol production.

Consumer Behavior

Increasing consumer preference for premium and above segments in alcoholic beverages, supporting the company's 30-35% growth target for proprietary brands.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to continually evolving state marketing regulations, product duties, and the risk of state-wide prohibition (e.g., Bihar's INR 40,000 Cr revenue loss over 7 years).

Taxation Policy Impact

Effective tax rate for FY25 was approximately 25.7% (Provision of INR 28.18 Cr on PBT of INR 109.65 Cr).

⚠️ Risk Analysis

Key Uncertainties

Regulatory changes in excise policy, potential for state-wide prohibition, and volatility in input costs (grains/coal) are the primary uncertainties.

Geographic Concentration Risk

High revenue dependence on Madhya Pradesh; penetration into other states remains a key monitorable for credit stability.

Third Party Dependencies

Dependency on Inbrew and Diageo-USL for licensed brand volumes and contract manufacturing income.

Technology Obsolescence Risk

Cybersecurity risk is noted due to dependence on software for daily operations, exposing the company to potential hacking or virus attacks.

Credit & Counterparty Risk

Healthy receivables management with a debtor turnover of 29.5x and a current ratio of 1.68x.