💰 Financial Performance

Revenue Growth by Segment

IMFL segment volumes grew 65% in Q2 FY26, significantly outpacing the overall revenue trend. Total income for H1 FY26 stood at INR 800.1 Cr, while 9M FY25 revenue grew 22.8% YoY to INR 1,103.93 Cr. This matters because the shift toward IMFL validates the company's diversification strategy away from being purely beer-centric.

Geographic Revenue Split

A major portion of revenue is derived from Madhya Pradesh, followed by Karnataka and Odisha. This matters because it creates high sensitivity to state-specific excise policies and economic conditions in these three regions.

Profitability Margins

Gross profit margin expanded to 41.06% in Q2 FY26 from 40% YoY. Net profit margin for H1 FY26 was 7.7% (INR 61.6 Cr). This matters because margin expansion during a period of revenue contraction (down 7.2% in Q2 FY26) indicates strong cost control and a better product mix.

EBITDA Margin

EBITDA margin improved to 15% in Q2 FY26 from 12.1% YoY, with EBITDA reaching INR 40.5 Cr. This matters because it reflects operational efficiency gains, particularly in returnable glass bottle management.

Capital Expenditure

The company is investing in Phase-1 of a greenfield project and expanding beer capacity in Odisha from 6.0 mcpa to 9.0 mcpa in FY2025. This matters because it provides the necessary infrastructure to support long-term volume growth targets.

Credit Rating & Borrowing

Interest Coverage Ratio (ICR) improved significantly to 12.57x in FY24 from 6.39x in FY23. This matters because it indicates a robust ability to service debt obligations following a reduction in interest costs and debt levels.

⚙️ Operational Drivers

Raw Materials

Glass bottles (returnable and new) and malt are primary raw materials. Standalone cost of materials consumed was INR 517.33 Cr in FY25, representing over 53% of standalone revenue. This matters because profitability is highly sensitive to price volatility in these specific inputs.

Import Sources

Not specifically disclosed in available documents, though operations are concentrated in Madhya Pradesh, Karnataka, and Odisha.

Key Suppliers

Not specifically disclosed in available documents.

Capacity Expansion

Consolidated beer capacity is 35.2 mcpa and IMFL is 3.9 mcpa. Odisha beer capacity is expanding from 6.0 mcpa to 9.0 mcpa in FY2025. This matters because it allows SDBL to capture growing demand in the Eastern Indian market.

Raw Material Costs

Cost of materials consumed was INR 517.33 Cr for FY25 (Standalone). Returnable glass bottle management is a key strategy to mitigate packaging costs. This matters because efficient recycling directly improves EBITDA margins.

Manufacturing Efficiency

The company achieved a 15% EBITDA margin in Q2 FY26 despite a 7.2% drop in total income. This matters because it demonstrates high manufacturing efficiency and the ability to protect margins through better product mix.

Logistics & Distribution

Not specifically disclosed in available documents.

📈 Strategic Growth

Expected Growth Rate

25%

Growth Strategy

Growth will be achieved through the premiumization of the IMFL portfolio (e.g., Mahavat brand), expansion into high-volume markets like Delhi and Uttar Pradesh, and increasing beer capacity in Odisha to 9 mcpa. This matters because premium products offer higher margins and geographic expansion reduces concentration risk.

Products & Services

Beer (bottled, canned) and Indian Made Foreign Liquor (IMFL). This matters because it allows the company to cater to both mass-market and premium consumer segments.

Brand Portfolio

Hunter, Power Cool, Black Forte (Beer), and Mahavat (Premium IMFL). This matters because strong brand recall, especially for Hunter, acts as a competitive moat in the alco-bev industry.

New Products/Services

Mahavat (Premium IMFL) was recently launched in Madhya Pradesh and Delhi. This matters because it marks the company's strategic entry into the high-value premium liquor segment.

Market Expansion

Targeting increased sales in Uttar Pradesh and recently entered the Delhi market with premium brands. This matters because these are among the largest liquor-consuming regions in India.

Market Share & Ranking

Not specifically disclosed in available documents.

Strategic Alliances

Not specifically disclosed in available documents.

🌍 External Factors

Industry Trends

The industry is seeing a significant trend toward premiumization and innovation. SDBL is positioning itself by launching premium IMFL brands like Mahavat to capture higher stakeholder value. This matters because premium segments are growing faster than economy segments.

Competitive Landscape

The company faces intense competition from large national and international alco-bev players. This matters because it necessitates constant investment in marketing and product innovation.

Competitive Moat

The company has a two-decade track record and established brands like Hunter. This matters because brand loyalty and distribution networks in states like MP are durable advantages that are difficult for new entrants to replicate.

Macro Economic Sensitivity

Not specifically disclosed in available documents.

Consumer Behavior

There is a shift toward premium IMFL and beer, as evidenced by SDBL's 65% volume growth in IMFL. This matters because it dictates the company's R&D and marketing focus.

Geopolitical Risks

Not specifically disclosed in available documents.

⚖️ Regulatory & Governance

Industry Regulations

The industry is subject to high government control, including state-level excise policies and pricing regulations. This matters because sudden regulatory shifts can disrupt the entire supply chain and pricing structure.

Environmental Compliance

Not specifically disclosed in available documents.

Taxation Policy Impact

Not specifically disclosed in available documents.

Legal Contingencies

Media articles in June 2024 alleged child labor issues at a plant in one of the Group's entities. This matters because it poses a significant reputational and regulatory risk that could impact licenses or ESG ratings.

⚠️ Risk Analysis

Key Uncertainties

Regulatory changes and volatility in raw material prices are key risks. This matters because they can cause unpredictable fluctuations in both revenue and profit margins.

Geographic Concentration Risk

Madhya Pradesh, Karnataka, and Odisha account for the majority of revenue. This matters because the company is highly vulnerable to any economic or policy downturn in these specific states.

Third Party Dependencies

Not specifically disclosed in available documents.

Technology Obsolescence Risk

The company has implemented audit trail features in its accounting software to comply with statutory requirements. This matters because it ensures data integrity and transparency.

Credit & Counterparty Risk

Not specifically disclosed in available documents.