Associated Alcohols & Breweries Limited (NSE: ASALCBR) Q3 2025 Earnings Call dated Jan. 27, 2025
Corporate Participants:
Anshuman Kedia — Whole-Time Director and Chief Executive Officer
Tushar Bhandari — Whole-time Director and Chief Financial Officer
Ankit Agrawal — Chief Financial Officer
Analysts:
Rahul Dani — Analyst
Aman Baheti — Analyst
Yash Gandhi — Analyst
Chetan — Analyst
Shantanu Basu — Analyst
Naman Shah — Analyst
Sunil Jain — Analyst
Kumar Saurabh — Analyst
Unidentified Participant
Rohan Patel — Analyst
Sumit Agrawal — Analyst
Debayan — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Q3 FY ’25 Earnings Conference Call of Associated Alcohol Beauties Limited hosted by Monarch Network Capital. 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 the 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 Networth Capital. Thank you and over to you, sir.
Rahul Dani — Analyst
Yeah, hi. Thank you so much. Good afternoon, everyone. On behalf of Monarch Networth Capital, it’s a pleasure to host the senior management of Associated Alcohols and Limited. We have with us Mr Anshuman Kedia, Whole-Time Director and CEO; Mr Tushar Bandari, Whole-Time Director, CFO; and Mr Ankit Agar Agarwal, Group CFO; and Go India Advisors, the IR team. Without wasting much time, I’ll hand over the call to the management for opening remarks and then we’ll move to Q&A. Thank you, and over to you, sir.
Anshuman Kedia — Whole-Time Director and Chief Executive Officer
Thank you, Rahul. And a warm welcome to everyone joining the Q3 and nine months financial year ’25 earnings conference call for Associated Alcohols and Limited. The financial results and investor presentation have been made available. And I trust you’ve had a chance to review them. Despite a dynamic and challenging environment, ABL has demonstrated resilience and focus, underscoring its position as one of the most dominant player in the Indian industry. ABL continues to make steady progress in expanding its product portfolio and strengthening its market presence. The festive season and the onset of winter served as key demand drivers, helping us achieve strong results in this quarter.
ABL’s presence across the end-to-end liquor value chain provides us with a unique advantage of offerings flexibility and operational efficiencies that help us navigate fluctuations in input costs. This performance underscores our unwavering commitment to innovation and quality, ensuring our products align with evolving consumer preferences and meets the highest standards of excellence. The Indian alcopev industry is undergoing a significant transformation driven by rapid changes in consumer preferences, premiumization remains a key trend and consumers are increasingly seeking high-quality. Aspirational products that offer a refined experience. This shift is reflecting a broader movement towards an emphasis on quality over quantity and at, we are well-positioned — positioned to capitalize on this evolution. Our approach has always been centered on innovation in introducing products that cater to the dynamic taste of today’s consumers while maintaining affordability.
Over the past few quarters, we have been strategically focused on strengthening our brand presence and ensuring our offerings stand-out in a competitive market. Our plans remain firmly on-track with focus on introducing new products and expanding into new regions. Looking ahead, we are excited about our upcoming product launches, which includes RTD, Brandi and tequila, each designed to meet the growing demand for diverse high-quality beverages. In addition to expanding our portfolio, we are actively working on extending our geographic reach. We are proud to be among the top-five players in Kerala and hold a substantial market-share in Madhya Pradesh.
As we enter new regions, we are confident in our ability to replicate this success by offering quality products at competitive prices tailored to regional preferences. This integration empowers us to remain agile and adaptable, enabling us to respond effectively to-market dynamics while consistently — consistently delivering value-driven outcomes. ABL strategy continues to focus on three key pillars: premiumization, operational excellence and market expansion. These elements ensure that we remain agile, competitive and positioned for sustainable growth. With these strategic pillars in-place, we are confident in our ability to continue on our growth trajectory while maintaining stable margins.
Now I would like to introduce Mr Pushar Bandari, who will discuss AABL’s strategic priorities and the performance of our recently launched products.
Tushar Bhandari — Whole-time Director and Chief Financial Officer
Thank you, Alshuman, and good afternoon, everyone. I am pleased to report that ABL is steadily embracing the premiumization trend. Over the past year, we have introduced two new products in the prestige and above category, and Ford Whiskey. The launch of these brands has not only strengthened up our premium product portfolio, but also refined our commitment to deliver quality at affordable price. These products have collectively garnered a sale volume of over 3,000 cases in the Nine-Month FY ’25. Our proprietary INFL brand sales volume grew by 23% this quarter compared to the same-period last year, driven primarily by the strong performance of our brands. Has exceeded our initial expectation in the key states, while Gin continues to see steady growth with expanded availability in other regions.
As we enter new markets, we remain confident that our product lineup will continue to meet evolving consumer preferences. We have secured the necessary permission and are making steady progress towards launch in UP, Maharashtra and Goa with the plans to enter additional states. Our ethanol plant is currently running at optimum capacity and we have successfully secured tenders from OMC with an allocation of 29,724 kiloliters of ethanol for the estimate supply year of ’24-’25. To support our growth initiative, we have installed additional bottling lines, bringing our total — total to 41 lines. This advanced facility enhanced our ability to meet the growing demand of both proprietary and licensed MFL products.
Additionally, our ongoing investment in single mall plant refers us a long-term vision of offering premium, high-quality products at an accessible price point. Going-forward, we anticipate that the contribution of proprietary MFL to our overall revenue will continue to rise, driven by new product launches and geographical expansion. There has been a lot of media report on the new excise policy of Madhya Pradesh FY ’25-’26. While the policy is yet to be finalized and approved, the outlined measures indicate significant steps towards enhancing governance, promoting transparency and supporting industry growth. As a company with over 40 years of experience in the industry, operating across diverse geography, the company has successfully navigated various regulatory landscape. We have believed that the proposed changes reflect a positive direction for the sector and present and new opportunities for growth.
We provide insight into the key elements of MP excise policy as-reported and their potential implications for AAPL. Liquor restrictions in 17 town and villages, policy inside, the proposed policy includes a restriction in sale of liquor in regional sites across 17 town and villages, resulting in closure of 47 retail shops across Madhya Pradesh. From these perspectives, the closure represents just 47 shops out of 3,300 shops statewide. This continued a minor fraction of the retail network and we do not foresee any material impact on-sales. The consumption from these areas is expected to shift to nearby towns, ensuring sales and as per our expectations renewable — renewal of retail shops licensing policy inside, retail shop license renewal will incur 20% duty highs. We anticipate that most retailers will opt for renewal ensuring minimal disruptions and the company’s sales will be as per expectations.
Mandatory and EBG, transaction to electronic finance and bank guarantees. We welcome this move as it enhances governance and transparency within the industry. ABR is well-prepared for digital compliance given our established system and practices. New bar license with lower fees limited to serve beer, wine and RTD products. This is a welcoming step that aligns with our plans to enter RTD segment in Q4 FY ’25. We expect this policy to bolster our RTD sales and support the expansion of our product portfolio. New segment in-country liquor, introduction of new 60 proof liter segment in-country liquor. While the performance of this segment will be evaluated over the time, we believe it’s present an opportunities to grow sales. ABL is well-positioned to adapt to these changes due to our flexible product capability.
The proposed policy demonstrates a progressive approach by the government focusing on modernized — modernization, governance and inclusivity in liquor industries. We believe these steps will support long-term growth and sustainability. ABL remains committed to leverage our existing experience, robust operational framework and strategic product innovation to capitalize on the opportunities presented by this policy. We are confident in our ability to adapt seamlessly and deliver consistently performance in the evolving regulation landscape. Looking ahead, we are particularly excited about our RTD segment launched in Q4 FY ’25 and our strategic enter into the new states like Maharashtra and Goa. These initiatives coupled with the operational efficiency position us strong to achieve our growth ambition.
Now I will hand over the floor to Mr Ankit Agarwal, our Group CFO, to discuss our financial performance for the quarter.
Ankit Agrawal — Chief Financial Officer
Thank you,, and good afternoon, everyone., we have delivered strong results across key financial parameters. Q3 FY ’25, the festive season in the advent of winter provided us a significant boost to demand, resulting in a robust performance. Net revenue increased by 71% to INR327 crores compared to INR191 crore in the same-period last year. This growth was achieved despite inflationary pressure on input costs, particularly for grain and packing materials. Even the rice price reaching INR28,000 per metric ton in the maze at 24,000, our focus on operational efficiency and disciplined cost management help us sustain a healthy gross margin of 38%. Encouragingly, raw-material costs have begun to stabilize, which would provide further relief in coming quarters. EBITDA for the quarter stood at INR40 crores with a margin of 12%, while PAT increased by 107% year-on-year basis to INR26 crores, achieving a PAT margin of 8%. In terms of segment-wise performance, proprietary MFL contributes to INR37 crores, reflecting a year-on growth of 31%. License brand revenue grew at 13%, reaching to INR77 crores. IMIL sales stood at INR62 crores, grew at 23%.
DNA contributed to INR39 crores. Ethanol revenue for the quarter was INR72 crores. Operationally, our proprietary MFL volume for the quarter stood at 4.69 lakh cases with IMF — with licensed IMFL brand reaching to 6.16 lakh cases. Merchant DNA volume for the quarter stood at 6 million liters and ethanol volume was recorded at 10 million liters. For FY ’19 ’25, net revenue grew by 61% to INR833 crores from INR508 crores in nine months FY ’24. EBITDA for the year stood at INR93 crores with a margin of 11%, while PAT increased to INR59 crores with PAT margin of 7%. Looking ahead, we remain focused on delivering revenue growth through our proprietary MFL products supported by new product launches and market expansion. We are immensely grateful for your trust and support. With a clear vision on the Board strategy, AABL is well-positioned to deliver long-term value for all the stakeholders.
Thank you. And now we can open the floor for question-and-answer.
Questions and Answers:
Operator
Thank you. [Operator Instructions] The first question is from the line of Aman Baheti [Phonetic] from InCred Capital. Please go-ahead.
Aman Baheti
Hi, thank you for the opportunity and congratulations to the associated team for a brilliant set of numbers. My — I had a few questions. The first question is related to the EBITDA margin guidance that the PPT contains. So on a consolidated basis, we have been saying that our focus will be moving on to some premium products and that can deliver a higher-margin. So why have we, you know, given a lower guidance of 9% to 11% of EBITDA margins?
Tushar Bhandari
So hi, so this year, our margins we are expecting on a year-on-year — for the full-year basis should be on a similar line. Since we have recently launched a new products in the premium segment, this will contribute additional no margin for the next year onwards me. This year, we expect the margin remains in a similar range.
Aman Baheti
Okay. So going-forward, will the margins improve as per management’s guidance to 13% to 15%?
Tushar Bhandari
Yes. Yes, definitely it should. From next year onwards okay.
Aman Baheti
And what has been the progress, sir, regarding your expansion in different states like Maharashtra and Gova? How is that going?
Tushar Bhandari
Okay. So as I already told that most of the formatories have already been done in the states of Maharashtra and Goal. And very soon, we will start supplying in these states. So Uttar Pradesh, Maharashtra and Poland, these are three states. So very soon — within this month, we’ll start supplying our products.
Aman Baheti
Okay. And one last question regarding the realization, sir. So our Indian made Indian liquor realizations are relatively steeper than our proprietary products. So going-forward, what kind of realization growth are you expecting?
Tushar Bhandari
So in terms of the IMIL, the realization would be on the or slightly higher. But we are expecting that in coming years that the realization in our IMFL brands, proprietary brands should increase as the sale of our premium brands would increase.
Aman Baheti
Okay, okay. And regarding our new product, the gym, so what has been the response in that?
Tushar Bhandari
So the new gym which has been launched is doing fairly well and we’ve launched right now in Madhya Pradesh, and Delhi and it has received a fairly well response. And in southern states, as I said that Mahashtra, Goa and Pradesh, which are the biggest state, we are seeing the — as soon as we start the sale, we will see an increase in growth in sale.
Aman Baheti
Okay, okay, great. Okay. That’s it from my side. Thank you.
Tushar Bhandari
Thank you.
Operator
Thank you. The next question is from the line of Yash [Phonetic] from Stallion Asset. Please go-ahead.
Yash Gandhi
Hi, thank you for the opportunity. Am I audible? Yeah. Hi. So my first question is that we haven’t seen increase in your depreciation cost in the quarters — in the last few quarters despite commissioning of the ethanol plant. So I just wanted to understand this.
Tushar Bhandari
See, so depreciation costs will remain in the same level or in fact, it will increase because right now in this quarter, we have commissioned — we have capitalized our bottling plant, new bottling plant. So this should go up a little in the next part. But the main reason because our — the distillery, which has got a little relatively old to depreciation has a few of the assets has got reduced over the period. Plus ethanol, the life of the ethanol plant is around is 20 25 years. So that’s where the comes relatively less.
Yash Gandhi
Okay. Okay, understood. And the second question is that we’ve seen a very good scale-up on your contract manufacturing fees, right? So I mean, how big do you envisage this segment together and what are the margins and what is the capex then we — that we want to do here?
Tushar Bhandari
So the contract manufacturing business, we are seeing a substantial growth in that. And looking into the growth and the sale of USL brands from whom we do contract manufacturing. We have set-up a new state-of-art bottling hall and we have added 10 new lines for that and which will be most of — most of it is automatic and we spend round about INR50 crores as a capex in that.
Yash Gandhi
Okay. Okay. And what is the margin that you in this segment?
Tushar Bhandari
Our margin is around 60%. So we get the bottle increase and out of that 50% is the margin of.
Yash Gandhi
FY ’26, what is the sort of the revenue guidance that you’re targeting? Do you think we can do over INR1,200 crores?
Tushar Bhandari
Yeah, we should. So considering ethanol and all if we will be flat, we should be talking that number should be higher than that.
Yash Gandhi
Okay. Okay. And my last question, sir, is that just wanted to understand your excise duty. So I mean ex of ethanol and ENA, I think the revenue is about INR215 crores for the quarter and you’ve paid like INR7 crores of excise duty on that or if you can just sort of help me understand the excise duty calculation here?
Tushar Bhandari
So see, so excise duty, you have to look statewide. So like in MP and Kerala, there is no excise duty on the part of manufacturer that is being gone by the retailers. So that doesn’t come in our books. And okay and the duty right now we are seeing is basically because of our increase in sales in Delhi and, where the excise duty is on the part of the manufacturer. So all the states — different states have got different policies. Certain states exercise duty is paid by the manufacturers and in certain states, excise duty is paid by the retailers.
Yash Gandhi
Okay. Okay. Okay. Got it. That’s it from my end. Thank you.
Tushar Bhandari
Okay. Thank you.
Operator
Thank you. The next question is from the line of Chetan [Phonetic] from Systematix Group. Please go-ahead.
Chetan
Yeah, hi. Thank you for the opportunity and congratulations on a good set of numbers. I have one question. I just wanted to know what is the status of our malled plant and what shall be its capacity?
Tushar Bhandari
So our mall plant is expected to start — we are expecting to start production in April, somewhere on April onwards. The capacity is 6,000 liters per day.
Chetan
Okay. And can you state the capex number for FY ’25 and ’26?
Tushar Bhandari
So for ’25 and ’26, we know around INR100 crores each year will be our capex outputy and that will be mainly through our internal accruals and the preferential money which we have raised.
Chetan
Okay. Okay. Yeah. Thank you.
Tushar Bhandari
Thank you.
Operator
Thank you. The next question is from the line of Shantanu Basu from SMIFS Limited. Please go-ahead.
Shantanu Basu
Hi, good afternoon. I’m tracking this company very recently. This is the first time I’m tracking to be honest with you. So just going by your PPK, I’m a bit perfect with the fact that your topline growth for the quarter against corresponding quarters last year is 71%, but the category growth that I’m seeing revenue growth is — I mean, the highest-growth that I’ve seen is 30% plus. So what am I missing? Can you please clarify?
Tushar Bhandari
It’s the ethanol plant, so ethanol plant, this will be first-quarter. So this got commissioned last year, Jan ’24, mid-Jan ’24. So this revenue was not there in the previous year numbers.
Shantanu Basu
Oh, I see. So just because — but I think I saw your ethan revenue also, you are showing something quarter-on-quarter you’re showing the revenue.
Tushar Bhandari
Since we don’t have the Y-o-Y numbers, we just compare quarter-on-quarter.
Shantanu Basu
So that is Q3 versus Q2 FY ’25 versus Q3 FY ’25. You have given the Y-o-Y number. So ethanol was missing in last December quarter. That is what you’re saying.
Tushar Bhandari
So the last Q4 Jan — so somewhere around 15 Jan the plant got started. Q4 will be the first-quarter.
Shantanu Basu
So December, it was missing. That’s why the growth is 71%.
Tushar Bhandari
Correct. Absolutely.
Shantanu Basu
Okay. Thank you. Thank you for that.
Operator
Thank you. A reminder to all participants, you may press time one to ask a question. The next question is from the line of Naman Shah from Monarch Networth Capital. Please go-ahead.
Naman Shah
Hi, sir. Congratulations on a good set of numbers. Sir, I just had two, three questions. Just wanted to ask about the broken rice announcement that the government has recently done. Will that — will that be beneficial for us in the ethanol segment?
Tushar Bhandari
So see the broken rice announcement, which has been done by the government would definitely be beneficial in the sense that the availability of the crop would increase substantially. And so the other crop and the price would go down, we are expecting it to go down the crop. And the price also which government has quoted is a very attractive price is INR20 to INR500. So definitely, this will benefit us in the reduction of the crop price — raw-material pricing, be it be it rice or be it corn also because lot of people males who are buying meals would get diverted to rice also and we are expecting the fresh crop also in the coming months. So we’ll see this — we are expecting to see the softening in the prices of raw materials.
Naman Shah
Right. And is this 9% margins in ethanol sustainable in the future also?
Tushar Bhandari
So margin in ethanol should be within the range of 7% to 9%. It depend on the — depend on the pricing of the raw-material. But yeah, if the price of raw-material sustained to level what it is, so we should be able to deliver those sort of numbers.
Naman Shah
Okay. Okay. And regarding Nikobar and Hilford, sir, could you specify on the revenue contribution by Nikobar and Hilford to our top-line?
Tushar Bhandari
So right now we have sold around somewhere around 3,000 cases. And slowly, slowly, we are catching-up and every month-on month, we are seeing this increase in sales. And so right now, it’s quite in terms of revenue and we are expecting it to grow at a faster pace and we have received a very positive response from the market. Right. We say is that the price realization in is 8,100. And in terms of is 3,100.
Naman Shah
Okay. Okay. So this 3,000 cases is for Nikobar or?
Tushar Bhandari
It’s combined.
Naman Shah
It’s combined, okay, okay. Okay. And sir, so what was the reason for the delay in the launch of RTD? I mean, it was supposed to launch in Q3.
Tushar Bhandari
So the delay launch in RTD was from the end-of-the machine supplier. The machine was getting — we are planning to — we were getting an imported from US and it’s getting delayed, it’s getting stuck there. That’s why it’s a delayed in launch. Otherwise, our most — our labor registration Madhya Pradesh is almost done. We applied for that and our packaging and everything is ready. We are — it’s being delayed on the machine supplier end.
Naman Shah
Okay. Okay, sir. Thank you so much.
Operator
Thank you. The next question is from the line of Sunil Jain from Nirmal Bang Securities Private Limited. Please go-ahead.
Sunil Jain
Yeah, congrats — congrats on good set of numbers, sir. My question relates to ethanol. So will you be buying this FCIE rice from the market — from.
Tushar Bhandari
So right now there is no — there’s not much clarity on how it will be given and to whom it will give. So right now government is also planning to come out with one more tender of supply of ethanol and there might — there might be a possibility that those tender will be given only to people who are purchasing HCI rice. So there is no clarity and who will be given at what quota would be given once that picture is out, then definitely if opportunity is there, we will definitely look at buying this price because it’s coming at a very attractive price.
Sunil Jain
So whatever the tender you got from OMC, against that if suppose the clarity comes, then you can buy rice from OFC and then that can support your margin?
Tushar Bhandari
Yes, definitely. And one more time because the quantity is huge. So if there is a huge supply — certain supply of raw-material still have a major impact in the commodity price.
Sunil Jain
Okay. So major benefit can come from the market decline price of the rice.
Tushar Bhandari
Pardon me.
Sunil Jain
You say that the major benefit can come because of the market whatever the current prices you said around INR28,000 that will come down and that will benefit the company.
Tushar Bhandari
Yes, yes.
Sunil Jain
And second thing, sir, how much is the yield from rice for ethanol?
Tushar Bhandari
So ye from rice from ethanol is around 450 450.
Sunil Jain
Okay. Okay. Thank you very much.
Tushar Bhandari
Thank you.
Operator
Thank you. The next question is from the line of Kumar Saurabh from Scientific Investing. Please go-ahead.
Kumar Saurabh
Yeah, hello, sir. So great to see I think from four-quarter back single-product launch to two products being launched and the roadmap. I have two questions. One on the product side, as you said, the cases together is 3,000. But in terms of the states we are targeting in next one to two years for these two products. One, what is the overall market size and what market-share we are trying? I’m not looking for exact number, but some fair guidance. That is one. And second, two, 3/4 back, we were at the lowest end of our raw-material margin cycle in terms of crane prices. The bottling prices were also bad. I think that was the worst. And going-forward, next two, three years, we are giving a guidance of 13% to 15% margin. And there are three components to it. One is because of our better premiumization revenue mix. So my question is, do you expect those margins keeping the reversal of bottling and prices or everything is included? And in the current margin like how much you see coming from premiumization and are the other two factors also contributing to margin improvement? These are the two questions I have.
Tushar Bhandari
To answer your first question, we will launch — we are launching these premium products in the state of Uttra Pradesh, Mahashtra and Koa and recently we have launched in Delhi and the market is used there, but definitely entering a new state with a new product and being it so competitive right now. It’s very difficult to predict how much market-share will you be able to achieve. But we are looking at in the initial stages to look at taking at least a 3% to 4% market-share of the product in terms of the brand category.
And in terms of –, we believe in expanding the reach and width of distribution, that’s where we are concentrating on, because we’ve got a very positive feedback from the market in terms of the quality as Nikobar is compared to other products which are available at the same price point or at a higher price point also in the market. So right now, we are looking at expanding the reach because gym is a product, if more visibility is there, the sale will increase substantially. So that’s what we are concentrating on.
And on your second question, I will not clear really any.
Kumar Saurabh
So I’ll just pick-up the second question. So premium product doesn’t contribute much in our top-line as of now because it’s very, very number, but we expect to increase it in further and that will also help us to overall increase in the margin of the company going-forward?
Ankit Agrawal
Okay. So sir, next two years, the margin improvement that —
Tushar Bhandari
You were also asking that the margin increase has also come from the operational efficiencies.
Kumar Saurabh
Yes. Okay. Okay. Okay. So your two years of margin guidance improvement which you are giving, is it more because of operational efficiency raw-material or is it more coming from premium products?
Tushar Bhandari
No, it’s not lower-right now, but this year we are saying that we will be in the similar lines. But in the coming years, we will — we are seeing an we will expect an increase in the margin because of the sale of premium products. Obviously, obviously, efficiencies will also be play a major role in that. But broadly, we are looking over the long-term period, the margin contribution should improve with the help of the increase in sale of premium products.
Kumar Saurabh
Okay. And sir, the last question, given we have launched two premium products and we are getting good reviews, but we are also fighting with players with significant brand play. So what is your marketing go-to-market strategy and brand-management strategy for these two premium products going-forward?
Tushar Bhandari
So our go-to-market strategy in different products is completely different. So in terms of as I told you, we are looking at bit of distribution and availability in chain. That’s what we are primarily concentrating on. And we’ve been able to capture most of the chains in MP and. It’s been recently launched in Delhi. So Delhi also really planning to do that. And in terms of fill for when it’s considered to be helpful. So what we’ve tried to do on the initial stage as per our strategy, which has been always is to provide value-for-money to the customers. So we have launched a good packaging, good-quality liquid we’ve concentrated and we are giving it at a reasonable price. That is one.
And second is we are pushing at the retail — retail counters. We are educating the retail customer, we are trying to — we are trying to give certain incentives to the retail salesmen. That’s why we’re trying to push and achieve our growth in that. And also we are working on social media platforms to create awareness and to create the premiumization look and feel and the experience of the product?
Kumar Saurabh
Great. And sir, last question on Madhy Pradesh partial liquor band. And I think in the beginning itself you told it’s I think maybe 3% of revenue at state is getting impacted. But the question is what triggered this action and do you think any possibility of this action of state government extending to more parts of Madhya Pradesh?
Tushar Bhandari
So this was primarily the action was taken in terms of religious — religious routes. And definitely as on today also, there is a policy that there should be no liquor shop near schools, temples and colleges. So on those lines, this policy has come about to be. And it has hardly it contributes only 1% of the shop, 1.5% of the shops which will close because of that. And definitely the sale of the shops will flow to other nearby shops. And on a long-term strategy, as you asked, that would it lead to bad in Madhy Pradesh. I don’t foresee that because as right now post-GST era, liquor excise duty to the government and WAT on petrol are the two major revenues for the state government. And we’ve seen in the attitude also change in the state government because right now before making the policies, state government ask the manufacturers and the retailers also to be a part of it and take possessions from us, which was not there earlier. So this also contributes — this also states that definitely we contribute to a major revenue of the state.
And plus apart from that, if there was a regional party in Madi Pradesh, we could have even thought of this kind of thing. But as it’s a national Party ruling party, so national ruling party cannot have different philosophys in different states. So that also gives us the comfort level that this kind of thing would not come in near-future.
Kumar Saurabh
Got it, got it. Thanks a lot, sir. And best wishes for coming quarters. Thank you.
Tushar Bhandari
Thank you.
Operator
Thank you. The next question is from the line of [Indecipherable]. Please go-ahead.
Unidentified Participant
Hello. Are you able to hear me?
Tushar Bhandari
Yes, sir.
Unidentified Participant
Yeah. So congratulations on the good set of numbers. So my question is like how much incremental revenue do we expect from the new geographies which we have added or which we plan to add?
Tushar Bhandari
So see the initial stages, we would not see much incremental revenue. But as over a period of time we would see substantial increase in the revenue because see these states which we are planning to enter are the biggest states in terms of liquor sales, which includes Uttar Pradesh, Maharashtra and Kerala — sorry, Pradesh, Maharashtra and Goa. So these are the huge states. And if we are able to crack certain portion of it also, we will see an incremental revenue to a greater extent. And as we’ve shown in terms of our incremental sales in Kerala, over the years, we’ve been trying to increase our sales in Kerala and we are now the 5th-largest market player in the state of Kerala apart from the — after the big companies. And we see a continued increase in the market-share in Kerala market. If that thing happens similar in one or two or three markets also, then you would see a substantial increase in the revenue from the sale of our premium products.
And that’s what the — that’s where the company is focused on and that’s why the company is also taking aggressive actions and recruiting senior — senior sales and marketing people in various states. That’s our strategy has been that we take certain senior well experienced players in-market — in different markets wherever we enter.
Unidentified Participant
So any ballpark figure which you target by FY ’26 or FY ’25 revenue 20%.
Tushar Bhandari
I cannot say FY ’26 or ’25, but over the long-term period, we are expecting a the sale from our proprietary brand should be around 50% to 60% of our top-line.
Unidentified Participant
Okay. Thank you. Thank you, sir.
Tushar Bhandari
Thank you.
Operator
Thank you. The next question is from the line of Naman Shah from Monarch Networth Capital. Please go-ahead.
Naman Shah
Hi, sir. Just one question. Just wanted to ask about the marketing spend. If you could give an absolute number on the marketing spend that we do.
Tushar Bhandari
So right now, the marketing spend is around about, say, around 3% to 5% because we are not going over over-the-board or we are not doing any over-the-board marketing and we are doing at the retail outlet level.
Naman Shah
And what is the percentage as the premium product increases.
Tushar Bhandari
So we will have to — as the premium product increases and the new markets we enter with the — with the premium products, we will have to increase our marketing spend in the initial years for creating the brand awareness and visibility and width of distribution, right?
Naman Shah
So that 3% to 5% can go to 5% to 6% or 7%.
Tushar Bhandari
Yeah, yeah.
Naman Shah
Right. And one more question, sir. What is the competition we see currently in tequila, gin, anybody who is coming up with a product similar to us.
Tushar Bhandari
You see, not only in terms of tequila or Jin, I would see that one is that there is a competition in all the categories which are there right now. But that’s a positive sign also because there is an opportunity as well. That’s where most of the people are coming in. So I see it will be on a long-term perspective, it will be completely on the survival of the fitted kind of platform. Like we’ve seen 100 gins which has been launched in India over the last couple of years. But out of which I think only 30 to 30 to 2025 are performing well. So one is that you have to be consistent.
Second is that you have to assure the quality is really good of the liquid and the packaging is good. And you have to keep evolving and coming out with the brand in the market that is there. This time talking about the and the other product portfolios. As you said about the new products which we are launching, which is the RTD and which is Takira. So we expect the RTD market to grow substantially. So we expect RTD market as per the markets where research should grow by at least 17% to 20%. So that is a great potential DC.
And in terms of tequila, in terms of tequila, there is no — right now there is only one or two Indian tequilas which are available right now and we will be the third one probably to launch a tequila. And arms would be pure tequila, which will be imported from Mexico. It will be 100%. So we see a great potential in that and we are seeing a growth of — growth of around about 30% to 40% in the tequila market. So there’s a good potential in that.
Naman Shah
Right. Thank you so much, sir. That’s it all.
Tushar Bhandari
Thank you.
Operator
The next question is from the line of Rohan Patel from Turtle Capital. Please go-ahead.
Rohan Patel
Yeah. Thanks for the opportunity. You fairly explain how does the business development and market development in IMFL portfolio works. But I want to ask regarding the country liquor IMIL we are doing certainly INR191, INR120 crore business in 2024 and that is pretty much stable. It hasn’t grown like in FY ’20, it was INR131 crore. So what are our plans in Countrylic like will it be a steady INR200 crore business where there would be only price realization growth and would be stable?
Tushar Bhandari
See the country would be a very steady market and it’s a very, very, very low-value product. And apart from that, it’s been done on the trendering process and the treasuring process has got certain gap on a particular individual of the quantity which of one person can take. So we are at the maximum quantity which can — which one distillery can take or bid or get — win the bid for a particular — for Madhya Pradesh state. So we see — we see whatever the growth in the industry would be there, we will grow at that pace only. And definitely as the cost increases, we might see the price increase because it’s done on the tendering process. I cannot comment on that. But that will be — that will remain the same and that will grow as per what the industry would grow.
So we are concentrating right now purely, purely, purely on our own value-added product and the premium product because that’s where the future is because now the young new entrant to the new entrant to the drinking age, they want to drink premium quality products. They want to drink less, but they want to drink good-quality. So that’s where we are targeting and there is a huge opportunity available there.
Rohan Patel
Okay. Fair enough. And can we expect now that the raw-material cost has stabilized like after FCI thing, coming down and other raw-material and feedstocks would be down. So the margin would be expanding through off the board, like in your premium products as well as your franchise product, licensed product and country we car.
Tushar Bhandari
The grain prices would definitely — we will see — we might see a short-term stabilization or downward trend in terms of grain price as soon as the FCI rice comes and the fresh corp comes in the next month. But over a long-term perspective, we see that there can be a certain stability coming in the grain rice because now the — if you see — if you see the data, the crop cultivation of mains is increasing month-on-month. So people are being — farmers are being more aware, we as an institution also are educating the farmers of benefits of growing maze. So as the maize availability increases, we might see a stability in the price because that would come — but that will take a year or two and the maze would increase substantially the cultivation of maze.
And your second question was?
Rohan Patel
Yeah, my question was regarding this only that way to explain. And just one question, which is quite a broad question and it has a qualitative elevant engineering. So what we have observed in IMFL is that the companies that have performed greatly in this sector have like two to three blockbuster products that have done like 1 million cases of business for them. If you see, if you see USL or if you see Radico, they have a couple of products that are like a million — millionaire brand. So like who make a millionaire brand, what does it mean? Like it’s definitely a quality of experience is making —
Tushar Bhandari
Making one or two brands of our brands as a million brands. And we are — we are extremely working towards that. So just to give you an example that in our entire portfolio, if you see, we were the — we were the first company to fastestly deliver a million case in when we launched in Kerala. Within a span of three years, we touched 1 million case and this year we expect to do 1.5 million cases. And in terms of brand levels, definitely and other like Agio and all these are very old companies and they have got products. So we are also working on those lines and we are believing that we should have the entire portfolio with us, which we are working on. So with RTD, with our brandy, with our tequila and in future our single mall. So we will be a one-stop shop for any retailer or distributor. So that’s what we are targeting to achieve in.
Rohan Patel
Okay. One thing that we have also observed from legacy players is that in a particular category, for example, say, most of them are getting away from value side and focusing lot on super-premium and high-end prestige. But they have a strong two to three brands within us a single category like for example, our USL has two to three brands in say semi-premium, even Perno Rica has. So are we planning to bring a say create a portfolio of say 10 brands out of that two to three will be in semi premium, high premium prestige or we will be going slow by bringing one brand and we’ll see how that performs. Then add another brand in same set category.
Tushar Bhandari
No, no, we will have the entire portfolio. So see the maximum consumption in India is the whiskey category. So in whiskey category, we have almost four brands right now. We have planned to introduce one or two more. So at every price point, starting from the lowest end-of-the price point to the premium — to the most premium price point, which will be — in future, we’ll be launching a single mod. We believe that we should be available in each and every category, okay. And out of these categories, one-product or two product can be the products which can — which help it really well and gain the market-share. In vodka category also, we have got two — two vodka with us, one is CP vodka and second is Titanium vodka.
In RAM also, we have two products. So like that, obviously, you will have to have a — one is a premium product and the second is a popular product because you cannot read the popular price range category also as the bigger player like, say, or USL are moving away from the popular category and going on the premium side only. So there is a huge potential of increasing the volume because volumes will come from the popular end-products. So we have got the concentration on there also. So we are making a basket of the entire product portfolio.
Rohan Patel
Okay. Okay, fair enough. Thanks for the questions. This was from my side.
Tushar Bhandari
Thank you.
Operator
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question is from the line of Sumit Agrawal [Phonetic], an independent investor. Please go-ahead.
Sumit Agrawal
Yeah, hi. So congratulations on good set of numbers. My question is regarding the distribution on these CST platforms, how is that going and considering the new launches to be in Jin and Tequila, how is like CST conducive to these kind of drinks.
Tushar Bhandari
I’m sorry I could not hear you clearly.
Sumit Agrawal
Am I audible now?
Operator
Sumit, please go closer to the microphone. Thank you.
Sumit Agrawal
Yeah. Am I audible now?
Tushar Bhandari
Yes.
Sumit Agrawal
So my question is regarding the distribution on the CSD platforms. Considering the two new drinks to be like engine and tequila categories, how are the sales in the CSD for both these kind of flickers?
Tushar Bhandari
Sumit, it’s a very well cushioned asked. We see a great potential in the CSD market. So we are in-process of getting our products registered. So it’s a lending process, it’s a six months-to one year process. So we are in the process of getting our products registered. But there is a huge opportunity in the CSD market, especially for the Indian — Indian liquor manufacturers as in CSD markets also the government has taken a serious step and have encouraged Make in India products. So all the international and imported products are banned in CSD. So there is a potential of gaining growing market there and we are working towards it. So there are certain — certain norms which we have to follow and certain inspection needs to be done. So we are in-process of getting that done.
Sumit Agrawal
Excellent, sir. And my second and last question is regarding any tentative date, everybody looks for like a single malt, it is the most kind of a hero product, highly premiumized. So any date you are looking at in future tentative date, not a — just a deadline, but just some tentative date on that?
Tushar Bhandari
We are expecting our plan to get commissioned — commissioned by April ’25, okay. By April ’25, the product will start coming out and at least minimum maturity in the past will be 1.1 to two years of that. So from April ’25, two years, you can see that we will have our own product. But plus our part in-between also what we are also doing is we are also launching a mid-range product. So right now, we have got a central Province and then we’ve got a. So we do not have anything — central Province EBB is 1,200 and our Hillboard EDP is 3,100. So we do not have any product in-between the staff. So we are trying to launch one more product in-between this for which we will purchase mall from outside and then launch it. So that by the time — by the time our product is ready, we would have a certain market study and market testing done with the products.
Sumit Agrawal
Congratulations and good set of numbers and hopefully for a good launch of single malt also, eagerly waiting for that. Thanks a lot.
Tushar Bhandari
Thank you, sir.
Operator
Thank you. The next question is from the line of Debayan [Phonetic] an individual investor. Please go-ahead.
Debayan
Hello, am I audible?
Tushar Bhandari
Yes.
Debayan
Thank you. So my question is regarding the ethanol plant actually. So if we see ethanol market is very much competitive. So I just wanted to understand the rationale behind entering the ethanol space. Thank you.
Tushar Bhandari
The rationale behind — getting behind ethanol space is that there is a huge opportunity there. So when the government has started the ethanol manufacturing that ethanol — when the government started encouraging ethanol manufacturing which was around about two to three years back, the government had targeted by 2025, they will achieve 20% blend in ethanol. So which government is expected to achieve as for the timeline. And in future, the ethanol market is going to grow only because the government is looking at reducing their import of oil and depending on their own ethanol manufacturing. And right now, it’s only available in petrol. So in future, the government is also working on technology to come in diesel and increasing the ethanol blending in petrol or in petrol also.
So there is a huge opportunity and there’s a better price realization. So right now, our price realization in ethanol is INR71.8 rupees, whereas in ENA, it’s slightly lower. So there is a huge opportunity also and it gives us economies of scale to us. So which gives us a higher realization in the overall portfolio because with the same — with the same staff and with everything being the same, we can achieve a higher-volume.
Debayan
So thank you, sir. Thank you and all the best. Thank you.
Operator
Thank you. A reminder to all participants, you may press time one to ask a question. The next question is from the line of Kumar Saurabh from Scientific Investing. Please go-ahead.
Kumar Saurabh
Yeah. So sir, in the IMFL segment for proprietary as well as IMIL also, we have done really well this quarter. If you can just spend some time and update what is working for us and this kind of like 31% growth in IMFL as well as in IML. Is it sustainable? That is one. And second, on the ethanol side, the kind of revenue run-rate which we are doing, could there be any volatility or these are contract-based where there is enough revenue certainty?
Tushar Bhandari
Are we didn’t get you? So see, so see the sustainable this quarter there has been a substantial increase in our sales. And definitely this would be sustainable. There will be a growth of 12% to 15%, which we see in IMFL volume of our case.
Kumar Saurabh
Okay. And sir, IMIL also, we have done well almost 23% of growth on Y-o-Y basis. So do you see IMIL also grow to sustain in single IML.
Tushar Bhandari
We will grow as per the industry or as per the market. So there is not much a contribution where there because completely depend on the tenders. We have a yearly tender and whatever tenders you get, you have to supply in those particular districts. You have — you are the sole supplier in those particular districts. And whatever the volume grows in that particular district, you will grow at that pace only. So would be stabilized only.
Kumar Saurabh
Got it. And ethanol, I think we are almost doing INR68 crores INR70 crores now and I think we are at our full utilization capacity. So do you think this number will sustain or if there are any kind of revenue risks there in ethanol?
Tushar Bhandari
And it will sustain because we are using an optimum capacity and we are at optimum production.
Kumar Saurabh
Okay. Okay. Okay. Thank you, sir. Thanks and all the best.
Tushar Bhandari
Thank you.
Operator
[Operator Instructions] Ladies and gentlemen, as there are no further questions, I would now like to hand the conference over to the management for the closing comments.
Tushar Bhandari
I would like to thank each and everyone who’ve taken out time to attend this conference call. And in case there is any further queries, you can directly contact Bonal or Go India. Thank you.
Operator
[Operator Closing Remarks]