Som Distilleries & Breweries Limited (NSE: SDBL) Q3 2026 Earnings Call dated Feb. 12, 2026
Corporate Participants:
Diwakaran Suryanarayana — Chief Operating Officer
Nakul Sethi — Director Finance & Strategy
Analysts:
Unidentified Participant
Sunil Jain — Analyst
Presentation:
operator
Foreign. Good day and welcome to the Somme Distillers and Beerus Limited Q3 and 9 months FY26 earnings conference call. 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 after this 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 would now like to hand the conference over to Mr. Divakaran from Soam Distillers and Beaure’s for the opening remarks. Thank you and over to you sir.
Diwakaran Suryanarayana — Chief Operating Officer
Good morning everyone. Thank you for joining us today to discuss our Q3FY26 performance. It’s always a pleasure to connect with our valued investors and analysts and I extend a warm welcome to each of you on behalf of the Soom team. Our company posted subdued numbers in Q3FY26 on account of more than expected cold weather conditions in our key markets like Madhya Pradesh Delhi which led a volume decline in the beer volumes. The situation was further impacted due to the less than expected recovery in Karnataka during the quarter. Looking at the quarter gone by, we recorded a total income of 2,542 million which reflects the challenges we faced during the period.
Our EBITDA for the quarter was rupees 231 million with a margin of 9.1%. Net profit for the quarter was rupees 55 million with a margin of 2.2% reflecting the present on our volumes and pricing during the quarter. In terms of volumes on the beer front, we achieved a total of 35.3 lakh cases marking a 24% year on year decline. Our IMF segment saw a strong 46% increase contributing 5 lakh cases. Despite the overall volume pressures, our IMFL brands continue to show positive momentum highlighting the effectiveness of our premiumization strategy. Near realization for Q3FY26 was rupees 543 per case compared to rupees 516.
Q3FY25, driven by a shift in product mix for IMFL realization stood at Rupees 988 per case, down from Rupees 1068 in Q3FY25 reflecting pricing pressures across the category. Looking ahead, we are hopeful of reversing this trend by posting encouraging numbers in the Q4 of this year driven by market share increases in our key markets. We remain focused on navigating the current challenges while continuing to expand our premium portfolio, execute our strategic marketing market initiatives and drive operational excellence. We are committed to delivering consistent value and sustainable growth for our stakeholders. I will now hand over the call to Mr.
Nakul Sethi who will provide further insights into our financial performance for the quarter. Over to you Nakul.
Nakul Sethi — Director Finance & Strategy
Thank you Diwa sir and good morning to everyone on the call. It’s a pleasure to take you through the financial and strategic highlights. A significant highlight during the quarter was the ongoing progress of our 570 crores greenfield project in Uttar Pradesh, phase one of which is expected to be completed by June of this year. This project under our subsidiary Utpaka Green Aging Nutrients will significantly enhance our production capabilities and provide the necessary infrastructure for long term growth. During the period under review, the company successfully achieved the financial closure for both phases of the project. This represents a key milestone and provides long term funding visibility for the project, enabling execution as per planned timelines and reducing the funding related uncertainties going forward.
For the nine months of FY26 our iron metal portfolio grew by 55% reaching a total of 13.1 lakh cases. Our BA volume reached 154.6 lakh cases down 13% from the same period last year. For the first nine months of FY26 our total income reached 1054 crores with an EBITDA of 135 crores and a margin of 12.9%. The net profit for nine months FY26 was rupees 67 crores with a margin of 6.4%. Despite a margin decline in revenue during the period, the company recorded improvement in gross margin and EBITDA margins reflecting operational efficiency and good product mix.
Reduction in profit before tax and profit after tax is primarily attributable to higher financial costs and increase depreciation during the period consequent to higher working capital utilization and capital expenditures undertaken for capacity expansion and strategic investment. The core operating performance of the Company remains stable and the management continues to focus on strengthening revenue growth, optimizing working capital and improving overall profitability. With the progress on our greenfield project and our focus on expanding our premium offerings, we are well positioned to capitalize on opportunities in the upcoming months and continue to create long term value for our stakeholders.
I would also like to take this opportunity to update you on the recent press release which was given by us on the suspension of the license of the at the Bhopal plant. We have made the required submissions in the MP High Court and we expect a judgment on the issue in the next two to three days. I would also take this opportunity to express my sincere Gratitude to all our stakeholders for their unwavering support and confidence in our business. Thank you everyone. And now we are open for the Q and A session.
Questions and Answers:
operator
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone 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. Our first question comes from the line of Manoj Pal, an individual investor. Please go ahead.
Unidentified Participant
Yeah, good morning, sir. And of course the numbers have been subdued. Am I audible?
Diwakaran Suryanarayana
Yes, Hello.
Unidentified Participant
Yeah. My question is how do you think this, that the recently that trade agreement which has been signed by the European Union and America. So how do you see whether it is an opportunity or it can track to our business? That’s my first question. Hello, sir.
Diwakaran Suryanarayana
Please go ahead.
Unidentified Participant
Sir, My question is that recently signed this FTA with the European Union and trade deal with America where their products will be allowed in India. So how do you see this deal. As an threat or as an opportunity for our business?
Diwakaran Suryanarayana
We don’t see it as a threat. We don’t see it as a threat. So will you explain it, sir? Yeah, Yeah, I will. I’m. I will explain. We don’t see it as a threat. And you have seen many of these multinationals with sense in the country with their legacy brands. Right? And we are competing with them. And we are the largest Indian beer company and that’s who listed their company. We are the second. Right? Only the second out of the two. Right. So we have been, we have been facing these market situations and facing competition like this from before.
And we have enough strategic, you know, approach as well as our executional approach to overcome any challenge of such kind.
Unidentified Participant
Okay. Okay, answer. My next question is in. In last to last phone call you said that, that the promoter has the intention to increase the stake up to the 51%. So is there any timeline or if, if it is so then what is the timeline and how they will increase the state, whether it will be from the open market or some other. Process.
Nakul Sethi
I’ll answer that. I think the time frame for increasing it to 51% is the next. I. I think short to medium term, maybe in the next two to three years. And the increase is going to come through preferential issues as and when the capital is required in the company or from open market purchases.
Unidentified Participant
Okay, sir, thank you. That’s all from myself.
Diwakaran Suryanarayana
Thank you, sir.
operator
Thank you. The next question comes from the line of Aditya Singh from Multi Bagger stocks. Please go ahead.
Unidentified Participant
Thank you for the opportunity. Am I audible? Yes, yes, you’re audible. Yeah. So the first question I had was regarding like what was the certain mix or certain changes that happened which led to, you know, such a quarter because. Earlier also we had the same amount. Of excess duty and the raw material mix but the results were way better. So if you could just fine tune it for me, that would be a lot.
Diwakaran Suryanarayana
Should I go ahead with this?
Nakul Sethi
Yeah, yeah, please sir.
Diwakaran Suryanarayana
Yeah. So the, the conditions in the market was extremely poor in terms of the consumption occasions and consumption times etc basically because of the weather condition and across markets, you know, the north market has declined very heavily. Cold conditions, the extended rains in, in the south of India it extended even till November December the rains were continuing and the cold conditions together have contributed to this, this thing. And also we have had some challenges in terms of regulatory issues in the state of Karnataka. Right. And which was overturned in the middle of the first quarter of this year. And that is also getting recovered in the marketplace. And we are seeing improvement quarter on quarter like first quarter performance versus the second quarter. Third quarter we are improving. And on third quarter is better than second quarter. And even the month of January, it’s looking better than the third quarter. So mainly to do with the conditions not conducive to beer consumption.
Unidentified Participant
Okay. And my next question was regarding that. In the last phone call you guys gave a target for 800 crore of net revenue for H2. And as you can see that in. This, in this quarter we have Already. Only achieved 250 crore. Near 250 crore. So are you confident that we can be able to reach 650 crore of revenue, net revenue for Q4?
Nakul Sethi
I looking at the scenario right now, I think we would reach about close to about 1500 crores by the end of this financial year.
Unidentified Participant
Okay, thank you. And can you provide any volume guidance for Q4? Q4 only, not for next year.
Nakul Sethi
Volume guidance?
Unidentified Participant
Yes.
Nakul Sethi
I mean obviously on volumes also we would do well as compared to quarter three because if we have to achieve, you know, close to about 450 crores or 6.
Unidentified Participant
Okay, thank you. That was all from my time.
operator
Thank you. The next question comes from the line of Piyush Anand from Paris Capital. Please go ahead.
Unidentified Participant
Yes sir. My question is so what is the status of ant entry and have supplies started and will it contribute meaningfully from Q4?
Diwakaran Suryanarayana
Yeah, so we received a communication from the Andra government which through, through appcm that on 23rd of January that they will. They’re opening the tender and deciding on it by 10th of February. So 10th of February they have not opened it. We got the latest update that they are likely to open it this weekend. So if they open it then our brands are already quoted and we hope to get the permissions very soon. It may. It may not be possible for us to. If they. If they act soon then we’ll be able to supply this quarter itself.
Otherwise for next year it will be a good revenue for us. We’re already in the back end working on establishing our teams and things like that. On the back end we are already started work.
Unidentified Participant
And sir, did Woodpecker launch in Odesa and Mumbai in Q3 and have you launched the single malt and has single mod has been launched. So you. You’re talking about Mumbai? Yes sir. Woodpecker launch in Odisha and Mumbai in Q3?
Diwakaran Suryanarayana
No, no. We are still in negotiation with the partners there on the. On the. The trade. You know we are negotiating with them in terms of our terms and things like that. That is still not closed. Sorry.
Unidentified Participant
And what’s on Mahavat branch.
Diwakaran Suryanarayana
When compared to quarter two? Quarter three has been better. We expanded Mahavat from Madhya Pradesh to Delhi and UP as well. And both these markets we are able to see penetration going up. Terms of availability as well as consumer response. So it’s a. It’s a game that we need to stay there and keep. Keep doing it. So it will take some time for it for us to realize the full potential of the. Of the plans that we made.
Unidentified Participant
Okay sir, so can we share your NSP growth price mix and current realization for case quarter?
Diwakaran Suryanarayana
Nicole, you please take that.
Nakul Sethi
Sorry. What do you want?
Unidentified Participant
Net sales value, growth price mix and current realization purchase of this quarter.
Nakul Sethi
That we had already given in the earnings presentation.
Unidentified Participant
You have a look. Okay sir and last question is excise as percentage of sales rose from 43 to 48%. So is this mix shift towards higher tax states? Is this sustainable or what?
Nakul Sethi
So I mean that is. See whatever states impose tax at the time of dispatch that is the difference between gross sales and net sales. Right. So obviously this is the money which comes back to the company. And this is incurred at the time of primary dispatch in most of the state. So it is. It depends upon the revenue mix from states which we are getting. So it’s not indicates anything which is the common notion that you know we have given higher excise or something.
Unidentified Participant
Okay sir, that is from my side and my name is Ayushanan I guess you have. My name has been taken wrong.
operator
Thank you. The next question comes from the line of Rudraksh Kalra from MB Investment. Please go ahead.
Unidentified Participant
Hi, good morning. So we’ve seen pressure on the top line and the bottom line. So where are we at the current moment? Like is the company going to have a regular March quarter or no? Firstly and the second question is along the trade deal. So how does our portfolio compare to is, you know, how does it compare to the demand that is imported into India? So if you could comment on both of those questions that we have. I think like Diva sir has stated in the previous question that we are quarter four in terms of margin there’ll be a reduction in change.
Rescue was we have increased the equity which was required in the subsidiary so all the accruals will be now used for reducing the interest cost which was not the case in the previous three quarters. And I think he has already answered the earlier question on the trade deal. Yeah but it was not very specific. So what is the demand that is in India from the American and European markets and what, how does the portfolio of the current, current portfolio of the company compare with the demand of the US and EU trade deals?
Diwakaran Suryanarayana
The more the players in the market is better for the business. I mean because we kind of, you know, learn from each other and it’s an opportunity for us to get better and better as we see, we don’t see a, we don’t see a problem for any of our portfolio. Maybe I think the overall if you look at the European markets and American markets and this FTA thing will probably help the IMFL a little more than beer because beer is a is. It all depends on price and depends on logistics. It depends on how we are able to service the market, width of distribution, scale, etc.
Etc. So I don’t see a problem with beer at all. So whatever, you know impact it will have, I think it will be more in the IMFL side and IMFL part of our business today is just about 10 to 15% of our revenue. Right. And we have an opportunity to grow there and we are also in these stages of premiumizing our portfolio. So I see that as an opportunity more than a threat and we are prepared. I mean we will do what is what we are capable of doing, what our portfolios capable to deliver will deliver that.
Unidentified Participant
All right, thank you. That answers my question.
Diwakaran Suryanarayana
Thank you.
operator
The next question comes from the line of Sunil Jain from Nirmal Bang Securities. Please go ahead.
Sunil Jain
Yeah, thanks for taking my Question. Sir, my question relate to first up expansion. So you said that the phase one will be starting in June. So can you talk about is there any other regulatory approval and all is likely to be awaited or all has been received. And phase one and phase two, if you can divide how much investment and how much revenue generation capacity it can be.
Nakul Sethi
So sir, there is no approval required for phase one. As of now all approvals have been obtained. The phase one investment is about 370 crores. Phase two is 200 crores. Phase two will happen approximately one year after phase one. Phase one entails establishment of a BURI with a capacity of 1 crore cases. And we expect that on an 80 to 85% capacity utilization that that capacity can give us about close to about 650 to 700 crores on top line.
Sunil Jain
Yeah, thanks for that. And the funding you said tied up with the bank so that there might there must be gap for the equity funding also. So how that will be funded means it will be internal accrual or there could be some equity infusion as well.
Nakul Sethi
Sir, that already has been funded.
Sunil Jain
Okay, so that already been funded through internal accrual. Because up till now you had not registered. Hello, the second question relate to MP plant. So now this recent press release what you had said. So currently our UP MP plant is close or is still operating?
Nakul Sethi
Oh, it’s close, sir.
Sunil Jain
Okay. So will this have impact on the Q4 numbers?
Nakul Sethi
Sir, I mean if it goes on for a long time then obviously. But we are trying to ensure that it should have minimal impact as of now.
Sunil Jain
Okay. Because then the peak season will start in the march. So if it extend then it can.
Nakul Sethi
Have a major impact resolved very soon. Sir, we are just waiting. We had made a petition last week in the MPI court and the petition was heard and the judge has reserved the order as long we are expecting this week.
Sunil Jain
Okay. Okay, fine. The petition has already been heard. Fine, sir. Thank you. That’s all from me. Thank you.
operator
Thank you. The next question comes from the line of Hiten Boricha from Sequent Investments. Please go ahead.
Unidentified Participant
Hello.
operator
Please go ahead.
Unidentified Participant
Yeah, thank you. So my question is on the recent press release. License has been cancelled. So can you share some color on that? What has exactly happened and why this cancellation has been issued against us?
Nakul Sethi
I think that we have already given a detailed press release on this. And also I have answered this question.
Unidentified Participant
Okay. Okay, sir. Okay. And my second question is on the Mahabad brand. Sir, you mentioned we have launched this brand in MP and up. So what is our Plans to launch. This brand in other markets like Maharashtra and other markets.
Diwakaran Suryanarayana
We. Our approach is very, very cautious on. On any launches. We make sure that wherever we have launched, it works for us. And then we expand to the other markets. So first now we did mp. MP has reached a reasonable scale in terms of width of distribution. And the volume also is repeating. And we are. We are happy with the progress that we are making in Madhya Pradesh. Delhi. We started in the previous quarter and there is improvement. But there is still scope for improvement in Delhi which we are working on. UP is also progressing well.
So we want to entrench these markets in a reasonable way and then step into other markets. Obviously the next set of markets will be the big markets like Maharashtra, Karnataka, all these markets. But first we want to be satisfied these three markets and then we’ll go ahead. Okay? Understood? Understood, sir.
Unidentified Participant
And my last question is on the. Gross margin as it was impacted by the raw material cost. So how is it shaping up now? And follow up on follow up question is on the demand. As you have. Mentioned in your opening remark. How is it shaping up now in January and February, sir? And is it. The recovery is back in the market.
Nakul Sethi
I think sir, the gross margin was impacted mainly by the share of Hunter going down in the overall sales mix. So if you look at quarter two, it was about close to 28% of our total beer sales and it has gone down to about 19%. And you would appreciate that Hunter is our mainline brand and it commands a higher ex brewery price as compared to the other beer in our portfolio. Plus there were some cost pressures on quarter to quarter where the prices of barley have risen in the range of 5 to 6%. Glass bottles have risen by about 3 to 4%.
So I mean the gross margin was impacted by that in quarter three. We expect that there should be a revival in the gross margins in quarter four because the season has started.
Unidentified Participant
Okay. So sir, can we like easily pass on this price? Are we looking to take a price hike in Q4 or maybe next quarter?
Diwakaran Suryanarayana
There is no plan to take any price increase. If there is an opportunity that is presenting to us, then we’ll look at it. At this point in time we are not looking at in quarter. We want to focus on. Focus on increasing revenues. And that is the first priority and that will continue to happen. Okay? Okay. Okay.
Unidentified Participant
And sir, just one clarification question. You mentioned 6700 Karun top line from the UP expansion. That is from phase one plus phase two. Right.
Diwakaran Suryanarayana
That only phase one.
Unidentified Participant
Okay. And any number on phase two, sir.
Nakul Sethi
I mean let’s wait for phase one to materialize. Then we can give you some clarity on phase two.
Unidentified Participant
Okay. Okay. Thank you.
operator
Thank you. The next question comes from the line of Rohit from Vishwai Investments. Please go ahead.
Unidentified Participant
Hello. I’m audible.
operator
Yes, sir.
Unidentified Participant
Actually peers have maintained or expanded somewhat margins. Why is our margin structure weaker than the peers? Is the. This is a scale disadvantage or operational inefficiency?
Nakul Sethi
I think you’re wrong in your statement. Because our peers is united. Guruji’s only. And that is only the listed company which is in the peer segment. So I don’t know from where did you get your facts?
Unidentified Participant
Sir, I think industry demand is also healthy.
Nakul Sethi
That’s what I’m saying. You have got all your facts wrong. Because UV is the only listed beer company besides us. So you are comparing us.
Unidentified Participant
No, I’m talking about. I’m talking about whole alcohol industry.
Nakul Sethi
That’s what I’m saying. Now you are telling me about my operational inefficiency. I am telling you about. You have to compare apple with apple. You can’t compare apple with oranges. And in the previous call also we have highlighted that there is pressure in the beer segment because of unusual weather hitting us hard. And so has UB also in its calls or in the results reflected on that. So you have to give some time for you know, the industry also to revive or the segment in which we are operating.
Unidentified Participant
Okay, sir. Thank you so much. That’s all from my side.
operator
Thank you. The next question comes from the line of Jitaksh Gupta from Tikri Investments. Please go ahead.
Unidentified Participant
Hi, sir. Am I audible? Yes, sir. I just have one question. Can you please provide the utilization of all our three plants which is Bhopal, Hassan and Orissa.
Nakul Sethi
So quarter three have we operated the opal plant at 56. Woodpecker at 42% and Odisha plant at about 36%.
Unidentified Participant
And the last question, sir. Is there any opportunity to expand more further at the. At our existing plant? Do we have any plans?
Nakul Sethi
No, I think we’ve got ample capacities at the moment at all the plants. Plus of course we are setting up a big capacity in up.
Unidentified Participant
Okay, sir. Thank you so much.
operator
Thank you. The next question comes from the line of Siddharth from vi. Please go ahead.
Unidentified Participant
Yes, sir. Thanks a lot for the. So my set of questions would be that we have experienced 25, 24%. You know, decline in beer volume. And there has also been decline in case for, you know, per case realization as well and parallel there is also some decline in IMFs, MFs, sorry, IMFL, you know, realization per case as well, despite the, you know, volume scaling up. So I just want to get some idea in terms of why this has happened. And I’m already factoring in the points where you’ve mentioned the Bali prices and the glass bottles prices have, you know, prices have spiked up.
Apart from this, what is the key contributions in general which is, you know, associating the decline. Decline in the, you know, top end, bottom end in general is my first set of question. My second set of question is that if you compare the company on a yoy basis compared to the revenues that was made on the previous, you know, yoy quarter, in this quarter the revenues have dipped but subsequently the excise duty has, you know, stayed up on. On a, you know, higher level which has led to the dip in the, you know, bottom line in general.
That’s something that I would love to have clarity on. And the last sort of question is that how is the bim, you know, currently position and their, you know, future prospects in general and what is the outlook you would like to have and the key market that have been launched in and what’s the future outlook and potential revenue contribution in general. So I, I just love like to have clarity on these set of questions and.
Nakul Sethi
Yeah, thank you. You went very fast. I could not even catch the question there.
Unidentified Participant
Oh, sorry, sorry. I’ll just take you through that again quickly. So my first question is that there is 25 to 24 percentage decline in beer volume and there has also been decline in case per realization. I’d like to have clarity on this and next I’ll take you to the next set of questions.
Nakul Sethi
I’ll answer that first. I mentioned earlier also in the previous question because the contribution of Hunter fell down as compared to quarter two. That is the reason that you know, the price realization has come down.
Unidentified Participant
Okay. And if I may know why the contribution of Hunter sell down?
Nakul Sethi
Because there was. Because Hunter sells mainly in Madhya Pradesh and Delhi.
Unidentified Participant
Okay.
Nakul Sethi
And it were impacted severely by unusually cold weather this time around. That is the reason.
Unidentified Participant
Okay. The unusual cold weather can be accounted for, you know, the dependability and the contribution of Hunter. Right.
Nakul Sethi
Yeah.
Unidentified Participant
Okay. Okay. Sir, this is one question of my. The second thing is that there has been, you know, a decline in, you know, per case realization of INF as well. So I would just also love to have clarity on the same following the. Next set of questions.
Nakul Sethi
So I think the realization went down from 988 to 939, but that was made up I mean I am talking of quarter two versus quarter three. But that was made up by the increase in volume. So I don’t think. Next question.
Unidentified Participant
Increase in volumes. Right.
Nakul Sethi
From 4.1 lakh cases it has increased to 5 lakh cases.
Unidentified Participant
Yeah, yeah. So you’re saying the price. This can be appone to the increase in volumes in general. Right? Just to clarify.
Nakul Sethi
No, no, no. This is the total. The brand adjustment work.
Unidentified Participant
Okay. Okay. On this. Yeah. So the next question of mine is that if you compare the top line of the companies on a yoy quarterly basis there has been depth in the revenue. I believe if I’m not wrong, close to 15 percentage. But excise duty has stayed up on the same line which has, you know, contributed to the, you know, different gross profit and all, you know, further metrics, you know, contributing to the bottom end. Just want to understand why, you know, exchange duty was, you know, high in general.
Nakul Sethi
I had mentioned it in a previous caller also that the excise duty, my friend does not have any role. It depends upon which state you sell. Okay. So you should always look at net sales. If you are comparing my performance, excise duty doesn’t. Gross sales doesn’t play any role in how the company performs. There might be instances where the gross sales will increase because I am selling more in say Karnataka or Odisha and less in mp. But the net sales would not have increased much. What’s my point?
Unidentified Participant
Yeah, I’m giving you order. Sir, I got this.
Nakul Sethi
You can connect with our investor digital relations team later on. Thank you so much.
Unidentified Participant
Yeah, actually I tried reaching them. There was actually an improper response. And I was actually waiting for you know, me to get them clarified on this one call. That is what.
Unidentified Participant
Thank you.
operator
Thank you. The next question comes from the line of Nagaraj, an individual investor. Please go ahead.
Unidentified Participant
Good afternoon. Am I audible?
Nakul Sethi
Yes sir. Audible sir, that you told that up.
Unidentified Participant
Plant phase one is for establishing beer facility and it will be completed in the month of June 26th, 2026.
Nakul Sethi
Yeah. Yeah.
Unidentified Participant
Okay. And my query is your informix rating agency in his report says this phase one will be completed in October 26th. Whereas you are committing June 26th. I just want clarification on this. And second thing is since we are completing the space one for beer sales in the month of June again seasonal range will start in the month of July and winter season will start. Is it not bad planning to commission the plant in rainy season? This is my first question.
Nakul Sethi
Let me answer that. Informatics has given this based upon what we had given the projections to our bankers. Right. So I think you should be happy that we are completing it before time.
Unidentified Participant
Okay.
Nakul Sethi
If you are going to commission in October, then obviously we’ll enter in the winter season. June will give us some main season plus it will help us also in stabilizing the plant. So I think we are very much thoughtful of how much. I mean what our planning is. So I think because we are running three plants as of now and this will be our fourth plant. So I think we are the promoters and the management team is pretty much explained experience in the way we want to conduct the business.
Unidentified Participant
And all the bank loans has been arranged for phase one. Sorry, all the required bank loans has been arranged for phase one.
Nakul Sethi
Yeah, yeah. Everything has been.
Unidentified Participant
And we had plans to launch our beer and IMFL segment in Tamil Nad and Karnataka. Sorry, Kerala. Can I just throw some light on this?
Diwakaran Suryanarayana
There was a. Yeah, yeah. Tamil Nadu, we are already present from April 20, 2025 onwards. And we have been progressing well in that market. In fact the last quarter was better than the previous quarter in terms of our market share and penetration. And Kerala, we’ve been there for last five, six years. I mean we have been doing a stable business.
Unidentified Participant
And you are just given a projection of reaching 1500 crores top line this year, financial year. Does it mean that we will be achieving around 450 crores of sales in Q4 excluding excess duty?
Nakul Sethi
Yeah, sir, that’s our aspiration.
Unidentified Participant
How. How confident are you to reach this 4 crores excluding exchange duty?
Nakul Sethi
I think we are pretty confident. Otherwise I would not have told you this number.
Unidentified Participant
Okay, sir. Good luck. Because retail investors like me, we have put our hard earned money and we are seeing the stock price going down month after month. I hope we succeed reaching this 450crores and stock price recover.
Nakul Sethi
And you should also bear in mind that you know, certain years are tough for the industry. Not every year can be, you know, growth years or something like that. So as an interior, you should have patience and have faith in the company.
Unidentified Participant
Yes, sir. We are a very long term investors holding big quantity of our portfolio in your esteemed company. And I wish you good luck to achieve 450 crores in Q4.
Nakul Sethi
Right. Thank you. Thank you so much.
Unidentified Participant
Thank you. Thank you.
operator
The next question comes from the line of Anuteep, an individual investor. Please go ahead.
Unidentified Participant
Hi. Hello. Good morning. First of all, so my question is regarding. You know, I. That you said that the cost of materials which have increased close to 55 crores from last quarter to this quarter. But the sales have only increased slightly I understand that you said the increase in cost is primarily due to the bottles and all these. Right? But that’s a significant increase, right? We did not plan this ahead or you know, like how did this effect is going to affect in the future quarters.
Nakul Sethi
I mean it if you would appreciate that PAR is a product which is used as a major raw material. Similarly, the prices of glass bottles also vary a lot during the year. So I mean there are certain things which we can plant and there are certain things which especially the cost pressures, when they come, we absorb because we cannot pass on these increases to the consumer. Because the excise policy is such that the prices are final once a year, you cannot have multiple price increases. That’s the peculiarity of this industry. Plus, I mean quarter three, I mean as I mentioned was pretty tough because our major consumption markets were impacted a lot by the cold weather and due to the sale of Hunter being low.
Therefore the net realization also was impacted. But let’s hope that quarter four and the ensuing quarter we are able to deliver good performance.
Unidentified Participant
Sir, but like when you say this, right? So how much inventory do you hold for this? Like how much months of inventory you hold for the bottles and all.
Nakul Sethi
On average? We hold. I mean, it depends. Beer is a very seasonal industry, right? Just like soft drinks. So I mean if you look at the lean season or when we are planning for the main season, we’ll hold about three months of inventory of glass bottles.
Unidentified Participant
Okay. And sir, I mean I just want to, I mean like what the previous investor has also said, right? I mean we are long term investors in your company and we believe the story. But you know, such a big margin drop. I mean, I understand that you are referring to United Breweries. I mean they are the only listed player in the market who is our apples to apples comparison. But they are able to hold the margins. I mean, so we are just coming from that perspective that you know, and again, obviously the kind of news that’s coming with the recent MP plant ban and all that’s having a lot of effect on the, you know, so also one more thing.
When you said the license has been cancelled, that’s only on the production, right? You can still sell the products in mp.
Nakul Sethi
First of all, their license has been suspended. It’s not been cancelled.
Unidentified Participant
Yes, that’s. Sorry.
Nakul Sethi
Yeah. And second, no, we cannot sell anything as of now.
Unidentified Participant
Okay? You cannot sell also in mp.
Nakul Sethi
I mean whatever is there in the shops is being sold. But production, we can’t do any fresh production.
Unidentified Participant
But you cannot use the production from Orissa. Or Karnataka to sell it in mp.
Nakul Sethi
That will not make sense also.
Unidentified Participant
But MP is a very big market for us. I mean.
Nakul Sethi
Yeah, yeah. You just have to give us another 2, 3 days to solve this.
Unidentified Participant
Okay. Okay. Thank you. All the best. And I hope you do achieve the 450 crores you promised. Thank you.
Nakul Sethi
All right. Thank you. Thank you.
operator
Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to the management for the closing remarks.
Nakul Sethi
Yeah.
Diwakaran Suryanarayana
Yeah. Thank you everyone for joining the call. We hope we have addressed your questions satisfactorily. For any further information, please reach out to our investor relations team. Thank you once again.
operator
Thank you, sir. Ladies and gentlemen, on behalf of som distillers and beeries, that concludes this conference call. Thank you for joining us. And you may now disconnect your lines.