Associated Alcohols & Breweries Limited (NSE: ASALCBR) Q1 2026 Earnings Call dated Aug. 11, 2025
Corporate Participants:
Unidentified Speaker
Anshuman Kedia — Whole-Time Director & Chief Executive Officer
Tushar Bhandari — Chief Financial Officer
Analysts:
Unidentified Participant
Rahul Dani — Analyst
Bharat Mani — Analyst
Karan Kamdar — Analyst
Khush Shah — Analyst
Nishita — Analyst
Rajveer Tandon — Analyst
Mohit Rajani — Analyst
Pawan Katariya — Analyst
Gautami Agarwal — Analyst
Presentation:
operator
Good day and welcome to the Q1FY26 earnings conference call of Associated Alcohols and Breweries Limited hosted by Monarch Net Worth Capital Limited. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Rahul Dani from Monarch Net Worth Capital Limited. Thank you. And over to you, sir.
Rahul Dani — Analyst
Good evening everyone. On behalf of Monarch Net Worth Capital Limited, it’s our pleasure to host the senior management of Associated Alcohol and Breweries Limited. We have with us Mr. Anshuman Kedia, full time Director and CEO, Mr. Tushar Bhandari, full time Director and CEO and CFO Mr. Ankit Nagori, Deputy General Manager. We also have Go India Advisors, the IR team on the call. So without wasting much time, I’ll hand over the call to the management for opening remarks and then we’ll move to the Q and A. Thank you. And over to you, sir.
Anshuman Kedia — Whole-Time Director & Chief Executive Officer
Thank you, Rahul. Good afternoon everyone and thank you for joining us on the Q1FY26 earnings conference call of Associated Alcohols and Rubies Limited. Our financial results and investor presentation have been uploaded to the exchanges. I hope you had a chance to go through them. We began FY26 with a clear sense of direction to build on the strong foundation we laid last year with continued focus on premiumization, geographic expansion and strengthening our operational backbone. ABL continues to establish itself as a rising player in the Indian alcoholic beverage industry. Backed by an integrated business model and a growing portfolio of distinctive brands.
The industry landscape itself is evolving rapidly. India’s premium Alcovec segment is benefiting from strong tailwinds. Rising incomes, increased urbanizations and shifting consumer aspirations are all driving demand for quality led craft centric products. Premium categories are now growing faster than the broader IMFL markets and that opens significant headroom for value creation. We are aligned to this shift. Over the past year, we made strong progress in building out our premium portfolio. Our two most recent launches, Hillfort Blended Malt Whiskey and Nicobar Gin are a testament to that. Both have struck a chord with consumers looking for authenticity, flavor and elevated experiences.
The positive market response reinforces our belief in a product led strategy. More recently, we introduced Central Province Vodka which is off to a promising start. We’ve also refreshed Titanium Vodka with a new Modern packaging, keeping it in step with evolving consumers tastes and reinforcing its presence in the prestige segment. Looking ahead, we’re gearing up to expand this portfolio further. One exciting addition is Cultures, our new ready to drink brand. It will be first launched in Madhya Pradesh. Thereafter we are planning to take it to Metro soon. Culture is designed for today’s consumer, someone who values light, flavorful and convenient formats.
The RTD market in India, currently pegged at around $72 million, is expected to grow at over 20% CAGR in the next few years. We believe Culture is well positioned to tap into this growing demand. Beyond RTDs, we are preparing to enter new premium segments including Brandy and Tequila to further strengthen our presence in high growth high margin categories. These launches are a part of our broader ambition to offer a well rounded premium IMFL portfolio that can cater to diverse consumer preferences across regions. Our entry into Maharashtra and Uttar Pradesh marks a significant step forward, positioning us in two of the country’s most prominent IMFL markets.
Maharashtra alone accounts for over 10% of India’s IMFL demand, making it a critical part of a long term growth story. These are markets where premiumization is clearly visible and we see significant potential to scale. As a part of our phased Pan India rollout, we continue to introduce proprietary brands, particularly the premium segment, across key high potential states. At the same time, we are reinforcing our operational efficiency. The commissioning of a new mall plant which will soon be fully operational, marks an important step towards backward integration, helping us ensure quality, manage costs and support innovation. All of which are key to scaling premium whiskeys in the years ahead.
Meanwhile, our ethanol business remains stable. We secured full allocations. With rice and maize prices cooling off, margins are expected to hold steady. The integrated nature of our business allows both ethanol and beverage alcohol to support each other, creating efficiencies and driving resilience. On the partnership front, our long standing relationship with Diageo continues to remain strong. We support them across franchisee and job work formats. As we move ahead in FY26, we do so with solid fundamentals and a sharper premium focus, broader market reach and a deeper understanding of evolving consumer preferences. We believe our strategy, grounded in innovation, operational excellence and brand building will continue to guide our journey and help us participate meaningfully in India’s Alphabet transformation.
With that, I’ll hand over to Mr. Tushar Bhandari, our whole time director and CFO to take you through the financial and operational highlights.
Tushar Bhandari — Chief Financial Officer
Thank you Anshumant and good afternoon everybody. Let me begin with a quick update on the External Environment as mentioned, we recently entered Maharashtra, one of the India’s most significant IMFL consumption market. The recent change in the state excise policy are something we are watching closely. It’s still early to fully assess the impact, but we are evaluating pricing adjustment across channels to limit any disruption and maintain growth momentum. The UK India Free Trade Agreement could also influence the India ALCOPEB industry. While it supports the premiumization strategy, we are mindful that it could lead to increased competition.
We are monitoring the situation closely and will approach as any such development with measured caution. Coming to our performance for the quarter, we’ve had a solid start to the year. Momentum has been strong across both volume and value, especially in our premium and above segment. A rich product mix has helped support margins from the cross perspective, the input environment has improved. Price of key raw material like rice and maize which remain high last year, have now stabilized. Packaging costs, especially glass, have also come down. We anticipate that the key raw material price will hold steady barring any unforeseen volatility.
These factors, along with our tight precautionary discipline and efficient supply chain helped drive an improvement in gross margin this quarter. We continue to stay focused on driving operational efficiency. Let me now walk you through the key numbers of Q1FY26 net revenue stood at 276 crores up by 6% year on year. Gross margin was 40% showing a healthy improvement. EBITDA stood at 37 crores up by 32% year on year with a EBITDA margin at 14%. PAD at 24 crores with a PAD margin of 9% for the full year. We have planned a capex of about 100 crores primarily to support the maturation project and continued with operational upgradation across our facilities.
Here’s a quick look at segment wise performance Proprietary IMFL revenue 41.3 crores up by 21% Year on year Imile revenue 73 crores up by 17% Merchant ENA was at 36 crores Ethanol was at 57 crore liters crore rupees and the volume proprietary IMFL 5.67 lakh cases up 31% Year on year license IMFL 3.87 lakh cases Merchant ENA 5 million liters ethanol 8 million litres Looking ahead, our focus remains on scaling our premium portfolio. The mall plant will soon be operational is a major step towards backward integration, improving quality control and enabling innovation. The groundwork is also being laid for our maturation facility which will support in house aging a key level for long Term brand building.
With the upcoming launch of RTD products, our entry into Maharashtra and Uttar Pradesh, and our sharper focus on premium category, ABL is in a strong position to tap growth across segment and geographies. With disciplined execution and financial prudence, we remain committed to delivering sustainable and profitable growth with the quarters ahead. With that, we can now open the floor for questions.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Bharat Mani from Moneybee Investment Advisors Private Limited. Please go ahead.
Bharat Mani
Hello. Am I audible?
operator
Yes, sir, you’re audible. Please go ahead.
Bharat Mani
Yeah, yeah. Congrats for a good set of numbers. My first question would be on the RM side, like in the opening commentary, you said the RM prices, the feedstock and the glasses have, you know, kind of stabilized and moderated. But the gross margins on Q1Q level have increased by 3%. So could you just explain a little bit why was that increase?
Anshuman Kedia
The grain prices are on the stable, stable format. But on the Q1Q there is a slight increase. But if we take about the entire year prospective last year to this year. So this year on Q1 the maize price is around 2022, 22,000 to 23,000 rupees as compared to last year, which is. Which was average at around 2400.
Bharat Mani
Yeah, but the Q4 was around 25,500 if I’m not wrong.
Anshuman Kedia
Right.
Bharat Mani
Q4 was 2020 500.
Anshuman Kedia
2020 500. Yes.
Bharat Mani
Okay.
Anshuman Kedia
That’s the maximum.
Bharat Mani
Okay, so that’s, that’s what I’m saying. So the gross margins have reduced by 3% on a Q. On Q level, the gross margins in Q4, FY25 were around 50, 43% and Q1 FY26 is around 40%. So why has there been a reduction in the maize price? The rice prices have reduced.
Anshuman Kedia
I’ll just check and get back to you on that.
Bharat Mani
Okay. Okay. So the second question would be on the IMFL proprietary business. So there has been a 30% volume growth on the yoy basis. So could you just explain what were the drivers of this growth? You know, were there the expansion into, you know, UP and Maharashtra? And if you could just talk about how has been the response in those two states? And you know about the existing states as well.
Anshuman Kedia
Okay. So the basically as earlier also we’ve said that our focus has always been now going forward is on our proprietary brand and the premiumization portfolio. So this growth primarily has come from a mixed bag from across different states. So to name a few, the growth has come from. One is the premium launch of Central Province Vodka in Madhya Pradesh. So that volume has added. The volumes have increased in the Kerala market. And certain amount of volume increase have come from UP market, Maharashtra market. Not major volume increases come because as soon as we launch the Maharashtra market the new policy of MML Maharashtra policy has come out with so which we are just evaluating and we are seeing what the competition is doing and then putting our price accordingly and moving forward.
Because till now there is no clear picture on Maharashtra policy how the competition will fare. So primary contribution has come from Madhya Pradesh market, Kerala market. And slight of it has come from UP market.
Bharat Mani
Okay. Okay. So the second question would be Hillford and nicobar jin. So FY25 you did a volume of 10,000 cases. So what is the volume that you did in Q1FY26 and what is your target for this year?
Anshuman Kedia
So Q1FY26 we’ve just. Just done around 2,000, 2,500 cases which will increase substantially. So we have targeted around 15 to 20,000 cases this year.
Bharat Mani
Okay. Okay. Just one more question. Just one more question. Is there any update on the Tequila launch? I guess there was some regulatory approval that you had which was in process. So could you just give me an update on that?
Anshuman Kedia
So in that Tequila launch we are in there were some regulatory issues from the Mexican government which was taking time. But now we are going ahead and we are in process of importing the Tequila. So I think around next two to three months we can target and launch Tequila. We’ve already placed a purchase order of importing the tequila.
Bharat Mani
Okay, just. Just one last question if I could. So you know there has been an excise duty in Karnataka followed Maharashtra. So do you expect any other states to go forward and put any hike in excess duty or what is the on ground scenario? As of now.
Anshuman Kedia
You cannot say anything per se in terms of excise duty. Because we are dealing with so many governments altogether. So what government, what step, what time take the takes the steps we cannot say. But see we have to be dynamic and adjustable as per the market change in scenario like whatever has happened in Maharashtra. So for that it’s become a setback for almost all the companies and primary for the big players. Which is there. So it’s difficult for them to operate or to strategize. So they might give up on the margins which they were getting.
And so it can be an opportunity for us that if we give a higher margin to distributors or retailers so our brands might click. But we are just assessing that how things is going to function and even the MML policy is not clear yet. So there can be an opportunity for being a local or Indian player to enter into the MML segment also if the, if there is an opportunity available there. So we can see it as an opportunity right now. But depending on states to state how they’re going to play, then we are going to take a call.
Because see now within this complete year, within this year end, we’ll have a portfolio of all the premium brands across the category. So we can play, we can play in each and every category depending on the market scenario and price it accordingly.
Bharat Mani
Okay, okay. Just, just before, before I get back in the queue. So the gross margins which I had asked earlier. So did you get a chance to look at the data and.
Anshuman Kedia
We’Ll just get back to you. Just give me something.
Bharat Mani
Okay? Okay. Yeah, sure. I’ll get back in the queue. Thank you.
operator
Thank you. Our next question is from the line of Karan Kamdar from Choice Institutional Research. Please go ahead.
Karan Kamdar
Hello sir. So I wanted to ask about the margins once again. So I see that our OPEX margins have improved. Rather OPEX as a percentage of sales has declined almost 50 basis points. What has improved? Similarly on the power side, your voice.
operator
Is not clearly audible. Can you please distance your device?
Karan Kamdar
Am I audible now?
operator
Yes sir. Now you’re clearly. Please go ahead.
Karan Kamdar
Sorry about that. So I’m saying OPEX has reduced operating expenses as well as power. So what would be the reason for that and will it sustain in the upcoming year or is it like a one time impact? No.
Tushar Bhandari
So the operating expenses, operating expenses has reduced because the efficiencies have come in and it’s sustainable over the years to come. And the power has reduced because the turbine, we are using the turbine fully because now almost all the plants are up and running at a full capacity. So that’s why the power is also reduced.
Karan Kamdar
So this kind of EBITDA margin. Sorry, yeah, please go ahead.
Tushar Bhandari
That is here to sustain in times to come.
Karan Kamdar
Okay, so this kind of ebitda margin of 14 odd percent is sustainable for the year or do you think we’ll still go back to 12% or 11% kind of a number?
Anshuman Kedia
Everything would depend on the grain prices, right? Now we are expecting grain price to stabilize because the crop is good and the maize cultivation acreage is also increasing. Like in Madhya Pradesh there has been an increase of 5%. And over the years people are getting being more educated and cultivating more grain, sorry maize because the requirement is huge in terms of ethanol and alcohol industry as well. So with that if the price of grain stabilizes or stays here then the margins are sustainable. But in the times to come as we are entering the bigger states.
Okay. We would have to invest certain amount of money in development of team and in marketing activities. So it should be around this range only if the grain price stabilizes.
Karan Kamdar
Got it, sir. And one question. If I can squeeze in on the IMIL side we’ve seen a lot of growth there. So what contributes that to that kind of growth and is that growth sustainable?
Anshuman Kedia
So see IML growth primarily we have seen because there has been certain increase in the consumption because of the new variant which was introduced in Imil. That is one product with a lesser strength and one product with lesser capacity like a 90ml was introduced this year. So that’s why the growth is there. But I think we would see a stable growth of around 5%, 3 to 5% in IML. And it’s a completely tender based process. We cannot do much about it. So our focus is right now only in our IMFL product of our own IMFL premium product.
So that’s where we are looking at driving the growth from.
Karan Kamdar
Okay, that’s it. From my side. Thank you so much sir.
operator
Thank you. A request to all participants. Please restrict your questions to three question for participants. For more question please rejoin the queue. Our next question is from the line of Khush from Nivesha Investment Advisor. Please go ahead.
Khush Shah
Hi, am I audible, sir?
operator
Yes sir, you’re audible.
Khush Shah
My question would be related. The RTD launch has been delayed. Can you elaborate on the reason and how we plan to complete with established players in this category.
Anshuman Kedia
See as we’ve also mentioned in the presentation that the delay was primarily because of the import of the equipment. So now we’ve received the equipment. Now we are under the process of registration. So as soon as the registration will happen within a month’s time we will first initiate the launch in the state of Madhya Pradesh. And then we will go to other major states where the consumption of RTD is higher. See to be competitive as per the peers which are there. So the only thing which we can do is that we can add more unique flavors.
And as we’ve also shown in our you must have received our annual report. So we’ve tried to make the packaging more attractive and more appealing to our consumers. So these are the two things and we are adding more flavors and we are. So we are giving more choices to the consumers. These are the two primary things and we are maintaining the quality. So our liquid also we will be using the best liquid in our rtd. So these are three things which continue apart from the marketing and promotional activity which will be be doing across. So this is the strategy to take the growth on the rtd.
Khush Shah
Okay sir, so my next question would be with the changing improve contact terms for IMF license to contract manufacturing. How will this affect top line trajectory and margins?
Anshuman Kedia
Pardon me.
Khush Shah
Hello.
Anshuman Kedia
Yeah, can you repeat it please?
Khush Shah
Yeah. So the change in improved contract terms from IMFL license to contract manufacturing. So what would be the affected top line trajectory and margins?
Anshuman Kedia
So that will. That will come effective from next month onwards. Okay. There will be a slight impact on the top line because the revenue would go in their books. But that we will. We were trying and compensating from our. From the increase in sale of our product portfolio and that should be the focus going forward. So we are concentrating on that. And apart from this we are in talks with INBRU and couple of other agreements also and expanding their expanding their product range across the country. So that materializes. So most of the things will get compensated in that.
But definitely we have to be focused in our own products. That’s what we are giving in doing.
Khush Shah
What why is improve taken so nice? Why why has been in brew has been taken in line. The.
Anshuman Kedia
We are any which ways if Andrew has taken it back. We will be the primary driver of the sales force here. And for that we will get a certain certain percentage we will be getting from that. Plus we are. We will be getting also the job work revenue from them. They have taken it back because of their own particular reasons. Which are. Which are known to them which I cannot disclose it here. So that’s the only purpose why they have taken it.
Khush Shah
Okay. So my last question would be. Our working capital is well managed. What are the key drivers behind this?
Anshuman Kedia
See primary the working capital is being well managed because of the efficiency of the main main money which is coming in from the state of Madhya Pradesh. Okay. From the government. It will completely depend on the states and states to you enter and what the payment cycle is there on those states. So it will completely depend on that. For example Delhi. Whatever products we sell, we sell is after the duty and the payment cycle is better there so we get the duty in advance. And Madhya Pradesh, we don’t have to invest in duty. So. So that’s why the major business is Madhya Pradesh and Kerala which is there.
So that is the major reason of working cycle being lesser. But as there’ll be a substantial increase in sale in say for example Uttar Pradesh. Uttar Pradesh, what we are looking at becomes an equally bigger state than Madhya Pradesh or Kerala. So then the working capital cycle might change a bit. But we will try and do other things in which we’ll increase the efficiency of working capital cycle.
Khush Shah
Okay. Okay. So sorry, my last question would be will the contract manufacturing arrangement for improve the same product previously under the IMFL business?
Anshuman Kedia
Yes. It’ll have the same products plus there’ll be other products also which they will be launching.
Khush Shah
Okay. Thank you. So thank you for my text.
operator
Thank you. A reminder to all participants. Anyone who wishes to ask a question may press star and one on the touchtone telephone. I repeat, anyone who wishes to ask a question may press star and one on the touchtone telephone. Our next question is from the line of Nishita from Sapphire Capital. Please go ahead.
Nishita
Hi, can you hear me? Yes ma’, am, we can hear you. Please go ahead. Yes, so I just wanted an update. On the malt maturity facility that you. Are doing and how much revenue is. Expanding from the malt plant and when will the commencement start?
Anshuman Kedia
The malt maturity plant has almost been commissioned Right now we are running few trials on the malt maturity and within a month’s time it will be up and running. The revenue would start first. Revenue with initial revenue would start coming out from one and a half years from today. Because we’ll have to mature the liquid for at least for one, one and a half year. And the more you mature. So for example, if you mature for two years, if you mature for three years, that’s how the revenue start kicking in.
Nishita
Okay. And like what is the revenue growth. That you are expecting once the revenue comes in?
Anshuman Kedia
So see, revenue would come in two different formats. One is that we will be, if we will be selling the pure mature malt, okay after one and a half years then the revenue would be completely different. But our objective is to convert into our own IMFL product. So if we are able to achieve that over next two years we are able to have what we are targeting, have a presence in almost 1012 states, have a good volume of premium brands, then we would be liking. Then we will be looking at, we will be looking at making our own single malt and selling that we would like to consume most of it internally in our own products.
So that will include our single malts. Certain amount of malt is going in our central province whiskey, amount of malt which is going in our own Hillfort whiskey. So if we are able to do that, then there will be substantial growth in the revenue.
Nishita
Okay, understood. Thank you so much.
operator
Thank you. May I remind all the participants if anyone who wishes to ask a question may press star and one on their Touchstone telephone. Our next question is from the line of Rajvir Tandon from Ventura Securities. Please go ahead.
Rajveer Tandon
First question would basically be that you’ve given a volume growth of 30% in the Amfil segment, the proprietary segment, but in your PPT, you’ve given a full year forecast of about only 20% revenue growth for that segment. Do you see any declines coming in or how is it so?
Anshuman Kedia
No, we do not see any decline coming here. You would see a growth at a higher, higher, higher, higher trajectory only. So, but over the years we would be somewhere around 25 to 30% growth in terms of our own IMFL proprietary brands.
Rajveer Tandon
So you’re telling that’s over the period of two, three years?
Anshuman Kedia
Yeah.
Rajveer Tandon
Okay. And my second question was regarding the tequila product that you’re launching. How’s the program on the approvals from the Mexican government? Parmi, how’s it progressed going from approvals. From the Mexican government? Because it was stuck. Right.
Anshuman Kedia
See, approvals are still under. Under. It’s still under process. But we are. Irrespective of that, we are going ahead and importing the tequila. And, and we would be selling it here. So the only thing is that we will not be able to call it tequila. We’ll be able to call it the agave spirit.
Rajveer Tandon
Okay. So not something like.
Anshuman Kedia
Process will be on. And as soon as we get the registration or the num number, we will incorporate it in the. In our packaging because we don’t want to lose on the opportunity. Because opportunity is right now.
Rajveer Tandon
Yes, yes. So it will be something like selling. Right.
Anshuman Kedia
Pistola is selling from Indian. Indian agave spirit.
Rajveer Tandon
We’ll be actually calling it 100. Got it.
operator
Thank you. May I remind all the participants, anyone who wishes to ask a question may press star and one on the Touchstone telephone. Our next question is from the line of Shubham, an independent investor. Please go ahead.
Unidentified Participant
Hello, sir. Am I audible?
operator
Yes, sir, you’re audible. Please go ahead.
Unidentified Participant
So, sir, I wanted to know how we are promoting our brands, our newly launched products. How are we promoting that?
Anshuman Kedia
So Shubham, to promote, promote our brand we are primarily working on a bottoms up approach. We are working at the lower end of the market which is primarily where the consumption happens. So if you see the consumption pattern, 70% of the regular consumer have got a fixed shop or got a fixed bar. So if I take an example of a Mumbai city, the consumer generally from office goes to a particular bar, have his couple of drinks and then takes a train and goes to office. So these are the people who have got their fixed bars or fixed shops.
So we try and influence at that level and we try and give CSM schemes to the salesman there. So that’s what we are doing. One, because we are sure of our quality and if the customer tries a product once then we are sure that out of 10 customers two will be able to convert. Because what we are trying to do is we are giving value for money to the consumers. That’s where we are doing. Plus we are doing bar promotional activity. We are doing bar education activity. We are doing activities for bartenders. Because see to develop a brand in premium category where only established players are there, it’s very difficult.
But we are not doing the. We are not doing the large scale activity which is like say advertisement branding or brand endorsement or team takeovers. We are not doing that right now. Because right now we have to work on the bottom end of the pyramid. So that’s where we are spending the more money and time. We are also in process of doing bar takeovers wherein there will be a bartender on our board who would be going to the premium bars and educating the bartenders there. Making cocktails from our brand, telling customers more about our brand and educating the customers.
That’s what we are doing right now.
Unidentified Participant
Okay. And my second question is when can we expect the products in Mumbai?
Anshuman Kedia
So the product right now product. We’ve already launched our gin and alford whiskey in Thane. And soon it will be available in Mumbai region. The only reason was that as soon as we launched in Thane it clicked and it was doing really well. And then this MMN Maharashtra made liquor policy came in. So we had to change our price structure. So we were just waiting what competition is doing or what the big players are doing are doing and pricing their products at. And then we will price our products. So which is almost done. Saturday our Maharashtra team was here in Indore.
We had a detailed discussion. And now from Tuesday, Thursday onwards we are planning to start in Mumbai as well. Mumbai and then which will be followed by Pune and other Pune which will be followed by Nagpur region.
Unidentified Participant
Okay, thank you for Taking questions.
operator
Thank you. A reminder to all participants. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. Our next question is from the line of Nishit Shah from Ambika Fincap Consultants Private limited. Please go ahead.
Unidentified Participant
Yeah, hi, this is Dhruv. Thanks for the opportunity. Tushaji, I have few questions. One is how is your. Can you hear me?
operator
Yes sir, now I can hear you. You are not loud enough. Please go ahead.
Unidentified Participant
Yeah, Anshuman, can you just give us a feedback on how has been the response for CP vodka which we just launched?
Anshuman Kedia
So Dhruv, the response for CP vodka is really great. And in the first month we launched BE in Madhya Pradesh we took a market share of around about 5 to 6%. So that speaks of the quality. Because in this price range category where we have launched there is no other vodka which is using triple distilled Ena. And this is the popular category where the volumes lies. So we are very focused on this particular category. So right now we have launched in Madhya Pradesh and we are working out economics how to launch in other states also.
And in this also we are planning to launch our hipster which is the pet bottle which we assume that will become a great hit. So in the first month itself we covered a market share of 4 to 5%. And in Madhya Pradesh we are targeting to around take a 15, 16% market share and which will be followed by other states as well.
Unidentified Participant
So our realization is at a discount to someone like our magic moments.
Anshuman Kedia
The magic moment is a higher price. So in magic movement price category we are. We have already redefined and we are launching a titanium vodka and magic moment price category. This would be in the white mischief price category in the popular range.
Unidentified Participant
Okay. Okay. And so on the brandy part, when do we plan to launch? Because we are entering the season for brandy. So do we expect sometime during Diwali we should launch a premium brandy?
Anshuman Kedia
Definitely during Diwali the brandy would be launched. The blend is ready, the glass bottles and everything packaging material is ready. And just before the Diwali we will launch it. Our focus was to launch it before Onam in southern markets which we are slightly delayed on. But before Diwali we will launch it.
Unidentified Participant
Okay. Right. And Tushaji, you mentioned that we have achieved the full allocation on ethanol. So should we expect around from next onwards 90. Around 9 million liters per quarter in ethanol.
Tushar Bhandari
Yes.
Unidentified Participant
Right. Okay. And this is the last question. When do we expect to launch in Goa and Puducherry? That’s what we have mentioned. In our presentation. So.
Anshuman Kedia
Sudhrup, the Goa Goa tire plant. We. The Goa tire plant is operational. We started our operation last week there. So right now we are making it for Pondicherry. Pondicherry. We will start supplying in coming week. We’ll start supplying and Goa also around first week of next month. We are targeting to start our supplies. The tie up unit is already operational now. There.
Unidentified Participant
Okay. Great. Great. Thank you so much. And also congratulations for a great set of numbers. Thank you so much.
operator
Thank you. May I remind all the participants. Anyone who wishes to ask a question may press star and one on their touchstone telephone. Our next question is from the line of Mohit Rajani from Daulat Capital. Please go ahead.
Mohit Rajani
Hello. Am I audible?
operator
Yes sir, you’re audible. Please go ahead.
Mohit Rajani
Yes. First of all congratulations on a very good set of numbers. And my first question is like Are you planning to add any new manufacturing facility as you have reached the full capacity with ethanol point?
Anshuman Kedia
So Mohit, we’ve also conveyed it in our earlier con calls also. So we are not planning to increase our ethanol capacity right now. We are completely. See we have been and we will be primarily an Alcobev company. And our focus would always be in increasing our own IMFL proprietary brand. That’s where we want to focus right now. At the time when we set up our ethanol plant the opportunity was right. The margins were very good at that point of time. And it gave us an economies of scale. Because in the same premises we could double our capacity.
So our overheads would be very less in the same capacity. But we are not looking at expanding our capacity in ethanol. Definitely we might increase our ENA manufacturing capacity. If whatever ENA we are selling outside is used for in house consumption then we will look at ENA manufacturing increasing in ENA manufacturing capacity for which we have already taken license one step license and and central pollution approval we have already taken in place. So we have covered most of the major steps which are required. So over the year, over one year to two years time which we will have to increase our ENA capacity.
Because our product for our own proprietary brands is increasing. Then we will expand our ENA capacity.
Mohit Rajani
Okay. And one more question. Like in Maharashtra and Goa like how is the distributor onboarding progressing? And like what are the early consumer traction are you seeing there in those regions?
Anshuman Kedia
So Maharashtra we are seeing a very good response. Especially for Hillfort Whiskey we’ve seen a very good response. Wherever we launch in Thane we are continuously getting repeat orders. But in. But the only initial setback Was that as I said that as soon as we launched the MML policy was there. So there was a pause of around 15 to 20 days. Now I’ll again start now. So Thane, we will start Mumbai, we’ve already taken on board one distributor. Pune. We are in process of taking a distributor which should be finalized this week. And then Nagpur we are looking at.
So these three regions cover almost around 60 to 70% of the market of Maharashtra. So we are primarily concentrating on these three regions. After we expand to other states in Goa, we are almost in the final stages of finalizing a distributor. So our Goa distribution will also start the first week of next month.
Mohit Rajani
Okay. And like could you also share the planned marketing span as a percentage of sales going forward?
Tushar Bhandari
See, right now our Percentage spend is 1% of the revenue which we would be looking at increasing if we are able to expand and at a full volume at the states we are entering like Maharashtra, UP Goa. And in future we are planning to enter say OESA market as well. So if that happens full fledgedly then we are looking at a market spend of around about 5% in the initial years.
Mohit Rajani
Okay. Thanks a lot. Like this is from us.
Anshuman Kedia
Thank you.
operator
Thank you. May I request to all participants please restrict your questions to two question per participants. For more question you can rejoin the queue. Our next question is from the line of Pawan Vina. Pawan Vinod Kataria from Blue Bullseye. Please go ahead.
Pawan Katariya
Are you able to hear me?
operator
Yes, sir, we can hear you.
Pawan Katariya
Yes, sir. Congratulations on the good set of numbers. So I had a question regarding the distribution footprint. So what has been our distribution footprint in Uttar Pradesh and Maharashtra? Maharashtra. You mentioned already to interrupt.
operator
Pawan. Sir, your voice dropped. Your audio dropped low.
Pawan Katariya
Are you able to hear me now?
operator
Yes, now we can.
Pawan Katariya
Yeah. So I would like to understand what is the current distribution footprint for Uttar Pradesh and Maharashtra?
Anshuman Kedia
If I heard you right, you want you are asking. Our distribution footprints in Uttar Pradesh and Maharashtra. So we are taking distributors on board. But eventually our goal is to set up our own sales team in the states we enter. Because our sales team we believe that we will be able to drive them better. So in Maharashtra also we’ve taken one of the senior persons on board from Diageo. So he’s joined us. And he’s driving the entire sales team. And he’s taking. He’s taking distributors on board. He’s taking state heads on board. But eventually our goal is to.
Over the period of year, our goal is to set up our own team in Uttar Pradesh. We are our own team is driving the sales there and is doing fairly well.
Pawan Katariya
Okay, okay. And how quickly are we scaling up our entree Horeta segments in bar, hotels and restaurants?
Anshuman Kedia
So in Horeka also, wherever it’s relevant, we have already put a person in place. So initially we are working on with one person who is just working with Horeca chains. And if the demand increases and if the demand in the major cities like Mumbai, Delhi and say Noida increases, then we will put few more people on place. But right now major focus is to increase the demand at the shop level.
Pawan Katariya
Okay. And so which brands do you see gaining a strongest traction in this new states like Uttar Pradesh. You mentioned about mp, but Uttar Pradesh, which brands are gaining the strongest traction? Okay, thank you. Thank you.
operator
Thank you. Our next question is from the line of Hitesh Kavatra, an individual investor. Please go ahead.
Unidentified Participant
I hope I’m audible.
operator
Yes sir, you’re audible.
Unidentified Participant
So my first question would be that recently as we have read that India and UK have signed like agreed on a trade deal and they plan to reduce. India plans to reduce the duties on, you know, imported drinks. What would be the like, you know, impact on our sales? What kind of impact do you foresee?
Anshuman Kedia
The thing is that the things are not clear yet when will happen, how it will happen. So there are multiple thoughts going around the market on these issues. One is that if the duty reduces, will the multinationals reduce their price or if they do not reduce the price, if they keep the price as it is and if they reduce the price, will the excise duties will be increased in respective states for these products. One thought is that second is they reduce the price drastically and it become a competitive market across. Third major thing is if they do not reduce their price and there are new products which will enter the Indian market in the name of Scotch and they price themselves at a very low price and then sell it.
So definitely there will be competition. I see a competition increase happening on that way. So for that you have to go for a backward integration. That is the best possible solution which we have already gone into it by setting up our own malt plant. Because quality wise Indian whiskeys or Indian malls is almost equivalent to any Scotch or any other whiskey made across the world. And now Indian whiskies and malls have gained traction across the world and have gained the recognition like what the Japanese. In Japan the maximum consumption is of Japanese whiskeys, not the Scotch.
We believe that time will come and those Scotches which will come at a cheaper price will have to compete with us or we have to compete with us and if the quality is right and we will be getting at a better price because we have got our own manufacturing. So I think we will be able to face that challenge for sure. And we are preparing for ourselves for that challenge.
Unidentified Participant
Okay. Okay. So good to hear that you are, you know, kind of you are preparing yourself in advance to the upcoming challenges of market. And one more thing like I can’t see major growth in the top line in this quarter. Like last year. June saw major growth in the top line as compared to the June 23rd quarter. There is no major like top line growth in June 25. Margin has improved like EBITDA has improved I think operating margins and profitability. But the top line hasn’t decreased much as compared to the last year.
Anshuman Kedia
On year top line does not increase much because there has been a drop in the sale of ena. Okay. Because we are using that ENA in own consumption. If that would have been converted like last year. In the first quarter we did around 5 billion litres. This year first quarter we did around 4 million liters. So there is a shot of 10 million liters that has been used in our own consumption. And the sale of increase increasing sale of our own products in other states would initially require expenses because we are taking team and we are taking senior.
So now again one thing, one more thing which we are investing heavily on is manpower. We are taking good quality manpower from the industry and experienced manpower because that will give you a greater advantage also because we are in a growing phase. So we are investing there also and we are paying as, we are paying them as per the industry standards. So what we have to invest and so that is also contributed because once the sales start increasing then we will see the transaction fraction.
Unidentified Participant
I think that will be all from my side as of now. Thank you.
operator
Thank you. Our next question is from the line of Vinay Ravel from Choice Equity Broking. Please go ahead.
Unidentified Participant
Yeah. Hi sir. Just. Just a couple of questions. One is on the up plant about which we have discussed in the Q2 as well. So just wanted to get a quick update on that. How it is it has been progressing and how. How the company sees it being funded.
Anshuman Kedia
So whenever the up plant if you’re talking about so plant we have already purchased the land, licensing and other process is under place. But by that time once we start setting up a UP plant we want to increase our sales. So that’s what we are concentrating on. We are first looking at increasing our sales. That is the major Thing which we have to look at right now. Second is the funding. Funding would be mostly through internal accruals. And I think we have raised some preferential shares in regards to the UP plan.
Unidentified Participant
Okay. Okay. Understood, sir. And the second question is on the rounds of how much of A and P cost that we have currently incurred as a percentage of sales and what is the percentage that we would see it settling at in the future as well.
Anshuman Kedia
Can you just repeat your question please?
Unidentified Participant
Yeah. I’m saying what is the ANP as a percentage of sales and how much it would be in the coming period as well. Advertising and promotional expenses to be clear.
Anshuman Kedia
Promotional expenses? Yes, promotional expenses as I already said right now is 1% of our proprietary sale which will increase to around 5%.
Unidentified Participant
And then as a percentage of total sales. Pardon me. Hello. Hello? Hello. Can you hear me? Hello. Am I audible, sir?
Anshuman Kedia
Yes.
Unidentified Participant
Yeah. Okay. So as a percentage of net sales, if you could just tell that it will be 5%. Okay. Sure. Thank you.
operator
Thank you. Our next question is from the line of Gautami Agarwal from Nivisha Investment Advisory. Please go ahead.
Gautami Agarwal
Sir. My question is that the Indu change in contract effect will be seen from the next quarter. So in this quarter via the numbers. Volume numbers for licensed partners partnership fallen so much.
Anshuman Kedia
The industry is fallen and we are in line with the industry. So that is the major reason. And plus this year also the season was short. That is the reason. These are the two major reasons.
Gautami Agarwal
Okay. Okay, sir. And sir, if you could give me volume numbers for Hill Fort and Nicobar individually for this quarter.
Anshuman Kedia
So Nicobar. So if I. If I put both of them together should be around about 2,000 cases. Yeah.
operator
Okay. Okay. Thank you sir. Thank you. Our next question is from the line of Manoj Bhoora from Adinath Financial Services Private limited. Please go ahead.
Unidentified Participant
Good afternoon to Sarji. Yeah. My question was regarding imbue. We have converted the system of franchisee sale to contract manufacturing again. So what will be the impact on top line and bottom line in the current financial year? This is my first question. Second question was regarding we had our Kerala success story. Then why we are not repeating the same in other states?
Anshuman Kedia
Okay, so good to speak to you. Manoji. See to first to answer your first question in terms of inbrew. So in brew the mechanism has changed and would affect our top line to the extent of the improvement inBru business which we were doing. That is the top line and the bottom line. But apart from that it gives us more opportunity to focus, be focused. On our own growth of our own brands. So that’s what we will be doing. So in inbrew the contribution, contribution to us will come primarily in terms of the job work manufacturing which we will be doing, revenue from that plus the ENS sale which we’ll be doing.
That that is there. So Indru added some own reason why it wanted to go on its own instead of a franchisee mechanism. But apart from that being a very strong partner of Inbrus who’s shown a potential substantial growth over the period of 5, 6 years whatever the business we did for them. So we have grown their brand almost tenfold. So looking at that partnership, we are in the process of other businesses that and other partnerships with them. So that is there. Second is and plus apart from that we will try and compensate the loss of the revenue top line and the bottom line by selling our own premium brands and focusing on that.
So we will be. So now our approach will be more focused. One is that second is in terms of, as you said, the Kerala story to be replicated in another stage. Definitely we are looking at that. And soon we will try and make a complete portfolio, a complete premium product portfolio and we would be able to replicate but it will take time. So like Kerala also it took us almost three to four years to be successful there. So you need to have consistency and you just need to wait for the right opportunity. You need to have the good quality product and you need to innovate and you need to work ahead of the market.
So that’s what we are doing in other markets. So if similar thing is repeated either in say Maharashtra or it’s repeated in, in say Uttar Pradesh, so then that will add substantially to the revenue which we are working towards it.
Unidentified Participant
Thank you.
Anshuman Kedia
Thank you.
operator
Thank you. Ladies and gentlemen. As there are no further questions, I now hand the conference over to the management for closing comments. Over to you sir.
Anshuman Kedia
Thank you once again for your participation and insightful questions. We sincerely appreciate your continued interest and support for Associated Alcohols and Breweries Ltd. As we look ahead, our focus remains on expanding our premium product portfolio, strengthening our presence in new geographies and sustaining operational efficiency. For any further queries or information, please feel free to reach out to our investor relations team at Goindia Advisors. We would also like to thank Monarch Network Capital Team for arranging and facilitating today’s call. On behalf of the entire management team, thank you once again for joining us. Stay safe and have a wonderful day.
operator
Thank you. On behalf of Monarch Net Worth Capital Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.