Som Distilleries & Breweries Limited (NSE: SDBL) Q4 2025 Earnings Call dated May. 30, 2025
Corporate Participants:
Diwakaran Suryanarayana — Chief Operating Officer
Nakul Sethi — Director Finance & Strategy
Analysts:
Hiten Boricha — Analyst
Bharat Mani — Analyst
Unidentified Participant
Nishid Shah — Analyst
Rajeev Khanna — Analyst
Ajay Mehta — Analyst
Anand Agrawal — Analyst
Rohit Deshmuk — Analyst
Presentation:
Operator
Hello, ladies and gentlemen, good day and welcome to the Distilleries and Breweries Limited Q4 and FY ’25 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 the presentation concludes. Should you need assistance during this conference call, please single an operator by pressing start then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to the management. Thank you, and over to you, sir.
Diwakaran Suryanarayana — Chief Operating Officer
Good afternoon. My name is Surinarana, I am Chief Operating Officer of. And I thank I thank everybody for joining us today to discuss our Q4 and full-year F ’25 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 game at Distilleries and Breweries Limited we had a very Q4 quarter as there was a steep excise duty increase in the state of Tarnataka, which made the beer dearer and also affected the volumes of the industry. So despite the sales loss, we were able to post better margins.
So looking at the quarter gone by our total income was 3,400 million, million was down by 12%. Our EBITDA was INR428 million as a margin of 13% and net profit was INR237 million, margin of 7%. Beer volumes were down by 10% and IMFL volumes were 3 lakh cases, which grew by about 22%. For the full-year, our highlights are annual beer volume was 234 lakh cases, up by 10% versus last year.
The realization was INR545 per case versus INR552 in-full year ’24. It was a result of pack mix and brand mix. IMFL volume was 11 lakh cases and our flagship brand Hunter grew at a rate of 15% versus last year. Key developments in the last year and last quarter was that we commenced construction of our INR600 crore greenfield facility in with a capacity of about 10 lakh cases per month and we also completed capacity expansion in our Odisha plant, which is located in to 90 lakh cases from the previous 60 lakh cases per year.
And as the — as the outlook goes, I think we are confident of building on current performance in the coming quarters. But and our priorities will definitely remain to expand our market reach, driving innovation and delivering value to our stakeholders. I now call upon Nakul to take it forward, take the discussion forward.
Nakul Sethi — Director Finance & Strategy
Thank you,, sir and good afternoon to everyone on the call. It’s a pleasure to take you through the financial and strategic highlights for the years gone by. For the whole of FY ’25, our total income increased to INR14,474 million from INR12,864 million, showing a year-on-year growth of around 13%. Our EBITDA for the financial year reached 1,807 million, reflecting a growth of 16% on a year-on-year basis with a steady margin of 12.49%. This is against the 12.07 margin reported last year.
The PBT for the financial year FY ’25 was at INR1,437 million as against INR1,219 million for the financial year ’24, showing a growth of 18%. The PBT margin for the financial year ’24-’25 stood at 9.92% as compared to 9.48% for the financial year ’23-’24. The net profit reported for the financial year FY ’25 stood at INR1045 million as against INR865 million reported in FY ’24 , showing a growth of 31%. With these impressive financial achievements, we remain confident in our strategy and execution capabilities as we continue to build, expand reach and drive sustainable growth across our key markets. I would also like to highlight that the finance cost for the full-year FY ’24-’25 stood at 0.76% as compared to 0.92% in the same-period in this financial ’23 ’24. The net-debt reduced by INR13 crores over the last one year from INR164 crores in FY ’24 to INR151 crores in FY ’21. There was a jump-in the secured debt in March ’25 on account of higher cash and preparation for. Before we proceed to the Q&A, I would like to express my sincere gratitude to all the stakeholders for the support and confidence in our. Thank you.
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 the touchstone phone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles we take the first question from the line of Hiten Boricha from Sequent Investments. Please go-ahead.
Hiten Boricha
Yeah. Sir, I have a couple of questions. First question is on the brand of PowerPool as well as legend. So we have seen a volume de-growth of around 22% this year. So I know you have highlighted something that the excise hike led to this degrowth. But if you can elaborate more on that, what has led to this huge volume business in power brand as well as in Legend brand.
Diwakaran Suryanarayana
No, I’ll answer the easier one first, which is legend brand. Legend brand actually we didn’t have a base at all. We actually from — from nowhere, we created a 2 million cases brand in the state of Karnataka. So that’s doing well and it will continue to do well. Of course, it also had some impact — I mean took some impact of the of the price of the duty increase that Karnataka government imposed on the entire industry, specifically on the economy brands.
And as far as powerful — powerful is concerned, I think the point was that the state of state exercise, Karnataka excise imposed the differential duty of INR130 per bulk liter on economy brand, right? So that took up the duty by about 40%, 50%. So thereby the consumer price went up from INR100 to INR145 rupees. The power pool brand went up from INR125, INR30 to over INR155 rupees. So therefore, there was some stress on the — on the volume and the revenue delivery from.
So it’s a — in my view, it’s a short-term thing. I think there is some correction that has happened after our representation to the government and our case in the — I mean case in the port, the government has withdrawn that duty and think we can look-ahead for a — it happened around the third week of May. So we can look-ahead for the next few quarters to be much — far better than the previous quarter.
Hiten Boricha
Sir, if you can share how much of total sales come from Karnataka?
Diwakaran Suryanarayana
Roughly INR100 report. Yeah,
Nakul Sethi
Around you know, about 30% of our sales comes from Karnataka.
Hiten Boricha
Okay. So this excise-led problem is only in Karnataka, right?
Nakul Sethi
Yeah, it is largely, largely Karnataka. Every year there is some amount of duty increase that happens in across the country, across all states, most states. But this year it was unusual increase in Karnaga. It never happened. In fact, in the financial year ’24, ’25 the government of Karnataka took two increases, one in September and then again one in January. So that was the major impact on the index.
Hiten Boricha
Okay, okay. Sir, my second question is on the capex, which we are doing in UP. So first question on that is, what is the total percentage of holding we have in that subsidiary? And also if you can elaborate on the funding side, how are we going to fund it?
Diwakaran Suryanarayana
So we are incorporating it as a 100% subsidiary of the listed entity and basically dividing the project into two phases. Phase-1 will entail expenditure of INR350 crores and Phase-2 would be another I think about INR200 crores to INR225 crores. So the funding would be right now what we have thought is through internal accruals and some debt. So we are not looking for any anything like that. Not right now.
Hiten Boricha
Okay. Okay. So INR350 crores this year and INR200 croress INR225 crores in FY ’27.
Diwakaran Suryanarayana
So Phase-1 will be used in this year, FY ’26, INR350 crores. So one would be can extend for the next — for the current year as well as some spillover would happen in the next financial year also.
Hiten Boricha
Okay. And sir,
Diwakaran Suryanarayana
Crores 40 crores of the project.
Hiten Boricha
Oh, okay. Understood. Understood. And sir, one last question is on the raw-material. I just want to understand the trend on the prices, sir, I think the is on the downground.
Diwakaran Suryanarayana
Yeah, right now, no, it’s not as simple to last year it’s stable, but yes, it’s stable as of now. So if you can quantify the prices right now? Or I don’t think we would want to quantify the prices as of now.
Hiten Boricha
Okay. Okay. I’ll get back-in the queue, sir. Thank you.
Operator
Thank you. You. Next question is from the line of Bharat Mani from Investment Advisors. Please go-ahead.
Bharat Mani
Hello, am I audible?
Diwakaran Suryanarayana
Yeah. Yeah.
Bharat Mani
Hi, thanks for the opportunity. My first question would be, could you just give me the plant was utilize utilization for FY ’25?
Nakul Sethi
So we — I think overall, I think that all the three plants together we were — we had a capacity utilization of about close to 70%. So that is the overall capacity.
Bharat Mani
Yeah, yeah. Okay. And the plant-wise, could you just give you as
Diwakaran Suryanarayana
The expansion because effectively that was done, right? So the full capacity impact of that capacity will come in the current year and
Bharat Mani
Okay. Okay. So okay. So my next question would be on the RM side. So could you just highlight a little bit on the glass prices? If you could not just quantify it, then just a Y-o-Y decrease in terms of percentage in glass as well as barley, if you could.
Diwakaran Suryanarayana
It’s I mean, obviously you would not want to indicate exact details as to what are the quantum of decrease also in the prices, what we would like to maintain here that if you have noticed that we have — our gross profit margins have also increased as compared to last year. So that is evident from the judicious use of a mix of new glass bottles and old glass bottles and I think the stable prices of raw materials.
Bharat Mani
So can I just confirm that the RM side, the prices have kind of stabilized and Europe so it will kind of give an in the near-term, right?
Diwakaran Suryanarayana
Yeah. We are expecting that same kind of margins we should be able to maintain in the current financial year also.
Bharat Mani
Okay, okay. So the other question was, I was looking at a PPD and it was written 32% increase of dispatch from the Gupal facility. So could you just tell me in what states you saw the this.
Diwakaran Suryanarayana
I think this is, I think with have you seen a lot of increase in Delhi say okay
Bharat Mani
, okay, okay. And the UP facility which you were talking about the INR600 crore capex. So when do you expect that to become also come on-stream
Diwakaran Suryanarayana
I think we will let me answer this question by July so that we have the exact numbers or the timelines and amount?
Bharat Mani
Yes. No problem. So have you taken any price hikes like this quarter or do you expect any price hike going into quarter one
Diwakaran Suryanarayana
Or even can you please answer that. Yeah. So on the back of the duty increase in Karnataka, there was an opportunity for us to round-up our prices on the higher side. Karnataka, we took a price increase and we took a price increase in the nearby state and Kerala. We took a price increase in as well and the duty went up. So I think therefore our potential margins are looking good.
Bharat Mani
But you just said that the excess duty has been reversed. So we expect the price to move down a little or do you expect this
Diwakaran Suryanarayana
— it’s already come in-place. But okay, around the third week of May, it started around fourth week of May, I can say. So we’ll now get to see the impact of that on the consumer prices by in the next couple of weeks. And then that impact should flow to us from the second, 3rd-quarter onwards.
Bharat Mani
Okay, okay. And just one last question. So monsoon is kind of early about like two weeks or so, especially in the South. So do you see any kind of effect in the demand in the South?
Diwakaran Suryanarayana
Yeah, it is — it’s very uncertain monsoon. I mean uncertain weather. One day it’s hot, one day it’s kind of rainy and cloudy and things like that. But beer consumption on the whole in the South, it’s not as skewed as the North. I mean, it’s a little more flatter than the North. So the weather does play a play a role, but I think — I don’t think it will have a big impact.
Bharat Mani
Okay. Okay. Just one last question if I could. So what is the volume growth guidance for FY ’26, if you could?
Diwakaran Suryanarayana
And we should — we should expect a, I think conservative level at least, 20% 22% growth. Okay. On the volume side you’re saying, yeah, you can say that it’s the revenue side as well.
Bharat Mani
Okay. Okay. Yeah. That’s it from my side. I’ll get back-in the queue. Thank you.
Operator
Thank you. We take the next question from the line of Utkar Jain from Mili Capital. Please go-ahead.
Unidentified Participant
Was regarding volume growth. It is a 20% volume growth or revenue growth?
Nakul Sethi
Yeah, revenue growth, you can say that can you guide for volume growth and average selling price that we expect in FY ’26? I think there’ll be a difference of about say about 18% volume growth?
Unidentified Participant
Okay. Okay. Thanks a lot. T
Operator
Thank you. The next question is from the line of Mishit Shah from Ambita Fincap Consultants Private Limited. Please go-ahead.
Nishid Shah
Yeah. Thanks for taking my questions., congratulations on a good set of numbers on a year-on-year basis. And I understand that there is a seasonality in the last quarter. My question is, do you benchmark on your performance parameters, especially the EBITA with the leaders in the market like United rurals
Diwakaran Suryanarayana
Where can you please come again?
Nishid Shah
You said that do you benchmark with the market-leader on the performance
Diwakaran Suryanarayana
No, I think they are the industry leaders and obviously they play a very significant part in the whole scheme of things. But obviously, we would not like to benchmark against them because our growth is different. Our key — core key states are very different from states. Obviously, we would not like to comment on UV performance of the way they operate.
Nishid Shah
I’m not asking you on how they are performing. I’m asking about your EBITDA level and their EBITDA level, which is a published come up. So where-is the difference and how do you breach that? And when do you come to the level of — so volumes are substantially higher, higher EBITDA margin?
Diwakaran Suryanarayana
Our EBITDA margins are much higher than there. So I mean you can look at those numbers and make your own judgment
Nishid Shah
And how much funding on the INR600 crore expansion in UP?
Diwakaran Suryanarayana
I have already answered that question earlier.
Nishid Shah
Maybe I joined late.
Diwakaran Suryanarayana
So I have already told that this project would be done in phases and initially we are targeting for INR350 crores of funding and that would be done through internal accruals and fresh term debt funding
Nishid Shah
You already have INR151 crores of debt.
Nakul Sethi
I don’t think that there is problem in taking more debt and most of the existing debt is for is the working capital debt. None of it is what I think about 30 I 35 crores is only the sound debt which is there on the board.
Nishid Shah
So basically going for debt right
Diwakaran Suryanarayana
For that equity or internal accrual
Nishid Shah
I have taken a decision or you have not taken a decision yet.
Diwakaran Suryanarayana
No, we have taken a decision.
Nishid Shah
Sorry
Diwakaran Suryanarayana
Because we have already spent close to INR40 crores on the project so-far.
Nishid Shah
We need to spend INR300 odd crores this year, right?
Diwakaran Suryanarayana
, sir, it will be taken care, not to worry.
Nishid Shah
But what I’m asking is a specific question that I that are you going to go only for debt or equity and if you are going for equity then have you appointed an investment tax us
Nakul Sethi
We are not going sir, I have already cleared I am not raising any fresh equity from the market. I last year posted INR180 crores of that will take care of whatever money is needed for the project, which will come through internal accruals. The rest of the money which is required will be take through term debt?
Nishid Shah
Okay, sir, I hope I am clear now. So I think you have been weighed on this. I am clearly asking there is no equity issues and that you are not denied.
Nakul Sethi
There is no equity issue and why is housing turned?
Nishid Shah
Ohh, because you are not hearing now. That’s why I’m telling you that you be clear. Thank you very much.
Nakul Sethi
Thank you.
Operator
Thank you. We take the next question from the line of Rajeev Khanna, an Individual Investor. Please go-ahead.
Rajeev Khanna
Good evening, sir. Thank you so much for creating an excellent infrastructure. Wish you all the very, very best. I just wanted to know-how is your market-share in the various markets that you operate in?
Diwakaran Suryanarayana
Yeah. See, we are we are number-one player in Madhya Pradesh, so we are number two, number three-player in Karnataka. We are number two in Delhi. We are almost number-one in number-one in almost close to number-one going neck-to-neck within leader. We are number two in. So I think you know, although we are much smaller than the market-leader, we are a very, very close competitor in almost all markets where we play.
Rajeev Khanna
So I must congratulate you creating one of the best infrastructures. I would request you to go all-out and as aggressively as possible to gain market-share, your market can go double or triple from the current levels if you continue to be very, very aggressive.
Diwakaran Suryanarayana
Okay. Thank you very much. And congratulations. Thank you very much.
Rajeev Khanna
Only question a little cause of concern was or maybe I had missed out the earlier part. Your top-line has not grown in the March quarter. You have any specific reason for that.
Diwakaran Suryanarayana
Yeah, which we explained, I think before you joined the call. So that’s an impact of the excise duty increase in Karnataka. A very, very unreasonable excess duty increase that for — not for the industry, but it fell more on brands, which are our kind of portfolio. So therefore, the impact came and that has got corrected by in the third week of fourth week of May this year. So hopefully, that will change our prospects for the coming quarters.
Rajeev Khanna
The only question if you could, are you gaining market-share in almost all these markets or are you at stable levels.
Diwakaran Suryanarayana
So like I said, we are — we are number two, number three and number-one in some markets and we’ll continue to focus on that. And we are strengthening our portfolio. We are portfolio company, that and we have three big brands and all of them are crossed all of them are millionaire brands, right? And we know the market, how it works and we are growing and we’ll continue to focus on both the top-line and the bottom-line.
Rajeev Khanna
So thank you very much. I wish you all the very, very best, sir. Thank you.
Diwakaran Suryanarayana
Thank you, sir. Thank you. Thank you so much.
Operator
Thank you. Participants who wish to ask questions, may please press star and one at this time. I repeat, to ask a question, please press star and one now. We take the next question from the line of Ajay Mehta, an Individual investor. Please go-ahead.
Ajay Mehta
Yeah. First of all, thank you so much for taking my question. So on the and side, I think there’s a very good performance that you demonstrated right across financial parameters and the value parameters.
Diwakaran Suryanarayana
Thank you.
Ajay Mehta
So I had couple of questions that my first question was, you are supplying to Tamil Nadu also where the beer will get supplied to Tamil Nad also from your Hassin facility. So is that — does that mean that you’re going to have an extra capacity utilization in your plant or you’re going to use the existing capacity itself to venture out on this part of the business the supply to basically.
Diwakaran Suryanarayana
Yeah. So in anticipation of our growth prospects in the markets that our house and plant services, including the state of Tamil Nadu, we have done a capacity expansion and I think we have sufficient capacity to give to. I mean, lot of which you already started.
Ajay Mehta
Okay, okay. And what is the volume growth — what is the contribution from we are looking at the overall top-line and the bottom-end volume from this particular new territory that you are entering.
Diwakaran Suryanarayana
So specifically, you know the challenges in the market, etc, et-cetera, we are we are negotiating all those things there and it’s a government market, I mean, and also the retail is managed by the government itself, right? So it is not so easy to give a forecast for that market. But we are confident that wherever we are going from the past experience that we have had, wherever we are going, the first year that in one and three years, we are confident of getting about 7% to 8% market-share between one and three years.
Ajay Mehta
Okay. Okay. And lastly, one more question, sir, one view that I had was, see, like and all that you as a brand is more of a premium brand, right? So from a distribution perspective, there is a think-tank in the process to distribute through more an organized player like Tonique or and all which are much more established distributor, right, in terms of catering to the youngsters and the affluent people, right, who would like to have beer.
So to have distribution through those channels also because for example, I in Bangalore, whenever I try to find a, let’s say, the woodpacker or other beer that you have legend, I don’t find it in Bangalore in a good distribution shop. I have to put a very small retailer to get those. So is there any view on that also?
Diwakaran Suryanarayana
Yeah. Thank you for actually our brands. I mean we are so happy to hear that from you. And I’m also a Bangalorian. I work-out of Bangalorian. So I can very clearly tell you that out-of-the two shops that you named or two group of retail shops that you name. One is Tonic. Tonic, our brand is available as we speak, right?
Ajay Mehta
Yes.
Diwakaran Suryanarayana
It’s available in all the three units. As far as-is concerned, we do have certain issues in terms of our commercial expectations from each other. So therefore, we are not intending to place our brands there. Whereas the brands of legend, etc., is available across all the shops, of course, it’s not available in topic.
Ajay Mehta
Okay. Okay. Fair enough. Thank you so much, sir for taking my question. I wish you all the best for FY ’26 and so forth. Thank you.
Diwakaran Suryanarayana
Thank you. Thank you so much.
Operator
Thank you. We take the next question from the line of Anand Agarwal from Balaji Investment. Please go-ahead.
Anand Agrawal
Yes, sir. So as I have gone through the balance sheet, I mean, so I can understand that there is a capex of around INR120 crores has been incurred and that is why almost completed. So can you just guide me with this capex and what kind of growth with this asset turnover you are looking for with this capex?
Nakul Sethi
Sir, can you please?
Anand Agrawal
Hello,
Nakul Sethi
Yes, sir.
Anand Agrawal
Yeah, yeah, Nakul. Yeah, yeah. My question is, I mean I’ve gone through the balance sheet in which the company has incurred capex of INR120 crores and I think that is being done. So I just want to understand for which this capex is done and what would be the revenue growth with this capex?
Nakul Sethi
This capex was done for both and for the Unita plant? Plant
Anand Agrawal
Okay
Nakul Sethi
And so Urisa plant advantage of this capex will come from this current year onwards and like sir had mentioned, we are looking at about 20% revenue growth that’s going to come from the capacity utilization for the whole year.
Anand Agrawal
Okay. So the — on overall, I mean 20% revenue growth for whole year. I mean for the combined entity, consolidated — I mean, not only consolidated so right?
Nakul Sethi
Yeah, yeah.
Anand Agrawal
Okay, okay. And one more question on the margin front on the similar margin front or there is any betterment in the margins due to the decrease in the raw-material prices?
Nakul Sethi
Sir, I think we expect that the margin we should be we should be able to maintain at the same level as last year.
Anand Agrawal
Okay, okay, fair enough. Thank you so much.
Operator
Thank you. Ladies and gentlemen, to ask a question, you may press star and one at this time. I repeat, participants who wish to ask questions may please press star and one at this time. We take the next question from the line of Rohit Deshmuk from Vishwai Investments. Please go-ahead.
Rohit Deshmuk
Hello, I’m audible hello. Hello,
Diwakaran Suryanarayana
Sir. You’re audible, sir.
Rohit Deshmuk
Okay, sir, my first question is actually the September quarter is generally are good for the home distill till now. So after this excess duty, is there any effect on the September quarter coming quarter?
Nakul Sethi
Sir, I was not able to understand. Can you please repeat it, sir?
Diwakaran Suryanarayana
Hello can you please repeat the question, sir? We couldn’t understand it
Rohit Deshmuk
Okay. So basically my question is that the September quarter is — the June and the September quarter is great for the company. Regarding sales expense and profit, but this time due to excess duty will be any on the September quarter,
Diwakaran Suryanarayana
You want to take a?
Nakul Sethi
Quarter is one of our leanest quarters is not one of our strongest quarters. Our strongest quarter is quarter one and quarter-four.
Rohit Deshmuk
Okay.
Operator
Thank. Ladies and gentlemen, that was the last question. I would now like to hand the conference over to the management for closing comments.
Nakul Sethi
Dear, sir, have please?
Diwakaran Suryanarayana
Yeah. Thank you all of you for taking out your time and attending this discussion and I I hope you have been able to answer all your questions and Napul and I are always there. If anything, anybody wants to call, we can call and take. Thank you so much.
Operator
On behalf of and Breweries Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.
Diwakaran Suryanarayana
Thank you