Tilaknagar Industries Ltd (NSE: TI) Q4 2025 Earnings Call dated May. 15, 2025
Corporate Participants:
Amit Dahanukar — President, Strategy and Corporate Development
Ameya Deshpande — Chief Financial Officer
Analysts:
Siddharth Rangnekar — Analyst
Palak — Analyst
Chetan — Analyst
Unidentified Participant
Jasbhir Sing — Analyst
Daksh Malhotra — Analyst
Dhaval Jain — Analyst
Aditya Singh — Analyst
Presentation:
Operator
Ladies and gentlemen, thank you for patiently holding. The conference will begin shortly. Please stay connected. Please do not disconnect. Ladies and gentlemen, thank you for patiently holding. The conference will begin shortly. Please stay connected. Please do not disconnect. Thank you ladies and gentlemen, good day and welcome to the Tilatnagar Industries Limited Q4 FY ’25 Earnings Conference Call. As a reminder, all participant lines will be in 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 and zero on your phone. Please note that this conference is being recorded.
I now hand the conference over to Mr Siddharth from CDR India. Thank you, and over to you, sir.
Siddharth Rangnekar — Analyst
Thank you. Good morning, everyone, and thank you for joining us on Industries Limited’s quarter-four and FY ’25 earnings conference call. We have with us today Chairman and Managing Director, Mr Amit; President, Strategy and Corporate Development by Deshpande; and Chief Financial Officer of the company, Ms Mr Gupta. We shall comment with views from Mr on the strategic performance and Mr on the financial highlights. This shall be followed by an interactive question-and-answer session. Before we commence, kindly note that the call could contain certain forward-looking statements and a disclaimer to this effect has been included in the results presentation, which is uploaded on the stock exchange website.
I would now like to invite Mr to make his opening remarks. Over to you, Mr Danukar.
Amit Dahanukar — President, Strategy and Corporate Development
Good morning, everyone. Happy to have you all join us on this earnings call to discuss the quarter-four and FY ’25 results. After a subdued first-nine months of the financial year, due to industry-wide disruptions in some of our key states. I am happy to share that we are back to our industry beating growth trajectory on the back of stable and progressive excise policy changes as well as our new product launches. During quarter-four, our volume performance was strong with growth at 20.1% year-on-year and 13.5% quarter-on-quarter. The route-to-market change in our largest state of Andhra Pradesh is now firmly behind us and has stabilized. Not only have we seen our market-share hinge back to earlier levels, but rather over the past three to four months have seen them expand. And we expect to maintain, if not better, our share in one of the fastest-growing IMFL states in India.
Our other core southern states have also continued to showcase impressive growth with each of them improving market-share in Q4. Karanataka, on the back of reduction in excise duties in mid-FY ’25 has seen strong growth momentum with our volumes in the state growing by more than 25% Y-o-Y in H2 FY ’25. We continue to be the third-largest P&A IMFL player in Karnataka, a state in which more than 80% of all IMFL consumed is risky. This is especially noteworthy given that our entire portfolio in Karanataka currently consists of brandy products We expect this trend of market-share expansion to continue across all key states given our strong launch pipeline for the quarters ahead. On the portfolio front, our luxury and super-premium portfolio is showing promising signs. Monarch Legacy Edition Brandi, our first luxury freight has now been launched in Maharashtra, Goa and and has shown encouraging traction not only from the trade, but consumers as well. The brand is especially doing well in with a very good bit of distribution achieved and repeat orders coming in. Business on the back of our usership agreement with Spaceman Spirits Lab, our investing company has also kicked-in. We did our first dispatch of Sansara Gins in April 2025 and believe that the SSL portfolio comprising of Samsara Jin, Ram and Amara Vodka will be a big contributor to our super-premium portfolio. As mentioned earlier as well, Industries will leverage its robust distribution network to sell SSL brands in certain states in India and abroad. With the above and the impending super-premium whiskey launch in H1 FY ’26, we will have a play in the luxury and super-premium segment in all the five key categories of IMFL, whiskey, brandy, gin, vodka and Ram. Our mass prestige portfolio, including Mansion house brandy and Napoleon brandy continues to perform well. Our commitment to ensuring share of voice reflects its share of market remains steadfast. While we are still in the early stages of our marketing investment journey, we are beginning to see a shift in consumer perception. Through continued marketing efforts and innovation, we are optimistic about making a more aspirational and inclusive category. While brandy continues to be our dominant category in the portfolio, we have made an entry into the semi-premium whiskey segment with the relaunch of Mansion House Whiskey in a new, we have launched Manchen House Whiskey in East and northeastern states of India and will be soon launching in our distribution strong states of South India. The initial traction has been encouraging. Our mid to long-term aim is to expand on our non-branded portfolio through innovative launches in the growing and profitable Prestige and above segment. These launches will fill-up gaps in our portfolio and enable us to have a more meaningful play across the country. Before I hand over to, I will very briefly talk about our financial performance. Our revenues in Q4 saw a healthy growth of 13.1%. The revenue growth was subdued vis-a-vis volume growth due to a reduction in price in our key state of Andhra Pradesh from Q3 FY ’25 onwards. However, for a night-to-like comparison, we have seen a strong 19.2% Q-on-Q — quarter-on-quarter net revenue growth vis-a-vis volume growth of 13.5%. Adjusted for subsidy income, the net revenue growth is 15.4% Q-o-Q-on-Q, indicating continued premiumization trend. The strong tenant profitability continued contributed by superior state as well as brand mix as well as operating leverage and disciplined cost management. EBITDA margin stood at 19.3% in Q4 and adjusted for subsidy income, the margins came in at 16.6%, a more than 300 basis-points increase in margin on year-on-year basis. On the input side, E&A still remains volatile and some level of increase in Q4 compared to Q3 FY ’25. However, we have seen some moderation in the E&A prices in April and May 2025 and are hopeful of a more conducive input cost environment. Our focus drive on cash-flow management continues and we now stand at a net cash level of INR107 crores, showcasing our balance sheet strength. I am also very happy to share that the Board of Directors has recommended a dividend of INR1 per equity share for FY ’25 to the members at the Ensuing Annual General Meeting. As we look-ahead, our strategy will be driven by enhanced presence across P&A within and other IMFL categories through our own brands as well as investments. We remain confident in the potential of the business and our ability to support brand expansion in key and newer markets. Our healthy balance sheet position keeps us in good step to chart our growth path forward. I would now like to conclude my opening remarks and invite Ameya to continue the discussion with the operational and financial performance. Thank you, and a very warm welcome to everyone joining us today. I’ll walk you through our financial and operational highlights for Q4 and FY ’25. As mentioned by Mr Dhanukar, we are back to our strong growth trajectory, having grown more than 20% in Q4 FY ’25. Our revenue for the quarter stood at INR406 crores and for the full-year FY ’25, we clocked a net revenue of INR1434 crores. Our net sales realization per case stood at INR1182 for Q4 on the back of the price reduction taken in Andhra Pradesh.
Ameya Deshpande — Chief Financial Officer
This NSR will now form the base and we expect the same to improve on the back of our premiumization strategies. Q4 also marked another strong quarter in our profitability journey with EBITDA growing 62.6% year-on-year to INR78 crores. EBITDA margins expanded by almost 600 basis-points to 19.3%. Adjusted for subsidy income, the EBITDA margin came in at 16.6%. For the full-year FY ’25, EBITDA stood at INR255 crore, reflecting a margin of 17.8%. Adjusted for subsidy income, the margin was 16.1%, a more than 270 basis-points improvement year-on-year. We expect the EBITDA margin to be in the range of 15.5% to 17% over the next couple of years.
Adjusted for subsidy, PAT for Q4 stood at INR64 crore, a growth of 62.6% year-on-year. For the full-year FY ’25, PAT excluding subsidy increased to INR201 crores from INR141 crores in FY ’24. Our net cash position as of March ’25 stands at INR107 crores, a sharp improvement from a net-debt position of INR74 crores as of March ’24, showcasing our disciplined debt and cash management strategies.
Before I close the opening remarks, I would like to reiterate that we remain committed to delivering profitable growth, expanding our presence in both existing and new markets and reinforcing our market leadership through focused innovation and strategic investments. We believe these initiatives will help us capture emerging consumption trends and create long-term value.
With that, I would now request the operator to open the call for Q&A.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their 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.The first question is from the line of Palak from MIV Investments Manager. Please go-ahead.
Palak
Hi, thank you for the opportunity. Sir, I have two questions. My first question is related to volume growth. I mean, after many quarters, we have delivered such a great volume growth. But my question is, is that only because of the Andhra Pradesh? I mean, if I mean, can you give — give us the volume growth excluding that state of Andhra and which state has shown the positive movement?
My second question is regarding the income tax assessment orders, which we have received. And I think in the last call, you mentioned that this quarter you’ll be able to — you’ll be in a position to give more color on that sir, these are my two questions.
Amit Dahanukar
So I’ll take the question on the volume growth. So the volume growth has been 20% and we expect to maintain this momentum going-forward into this current financial year. Of course, the growth in Andhra because of the subdued performance in Q2 and Q3, as elaborated earlier, the growth in Andhra was much more in-quarter four, but the other markets also have shown promising volume growth, particularly Karnataka. Long-term tax assessment, the CFO will take-over.
Yes. Yeah. So if you see, we have already informed to the stock exchange that post the assessment done by the income tax department, our carryforward losses stand at around INR32 crore as on, 31 March 2024. However, we have appealed against the assessment done by the income tax department with commissioner income tax and that proceedings are currently underway. So we will be able to give you an exact or rather a more prudent advice post the outcome of the — our appeal against the order at commissioner income tax Level. As of now, you may assume no tax for the June quarter.
Palak
Sir, you mentioned INR32 crores losses.
Amit Dahanukar
Yeah.
Palak
So I mean from next quarter we’ll start paying the taxes?
Amit Dahanukar
No, so we have already appealed against the order of the income tax with commissioner income tax. We are hopeful that by next quarter, we will be able to know the outcome of the appeal and accordingly, we will be able to inform about from when we will be required to pay tax.
Palak
As sir, just a follow-up question on the fourth part, sir, do you have any data on what was the volume growth excluding Andra?
Amit Dahanukar
Yeah. So I’ll just give you a basic sense, right? So while Andhra grew by more than 30% in Q4. States like Karnataka grew by more than 25%, right, in Q4 whole of H2 actually, Karnataka grew by more than 25%. In addition, also states like Tamil Nadu also contributed to our growth along with — along with Orissa and Tela.
Palak
So any question why growth was for us?
Amit Dahanukar
Yeah. I think it’s not only us to be very frank with the entire industry, right? If you remember and also what Mr Dangar covered in his opening remarks that excise duties were reduced in Karnataka towards the latter part of H1 of FY ’25, right? So that brought down the consumer prices so by a meaningful number. So that led to a significant growth in H2 for the entire industry as a whole. Obviously, we are — we grew slightly higher than the overall industry, thereby increasing our market-share in the state as well.
Palak
Okay. Thank you.
Amit Dahanukar
And this growth, just to clarify, this growth predominantly came in the prestige and above segment.
Palak
And any market-share gain numbers that you would like to give us? I mean in statewise. So you are saying that you have gained from certain market-share. So can you give us a number?
Amit Dahanukar
So state-wise, we can’t get into the detailed specifics of state-wise in this forum.
Operator
Thank thank you. Before we take the next question, a reminder to all the participants that you may press star and one to ask a question.
The next question is from the line of Chetan from Systematix. Please go-ahead.
Chetan
Hi, thank you for the opportunity and congratulations on a good set of numbers. My question is on the Prague distillery. We had previously-stated capacity expansion at Prag Pragh from 6 lakh cases to around 36 lakh cases. Could you please highlight if any of what proportion of this expanded capacity is intended to cater to the Andhra Pradesh market? And if so, is this decision primarily driven by the strong growth we are witnessing in Andhra region or is it aimed at only replacing the existing production from the contractual manufacturing units for cost-savings?
And secondly, again, can you also provide like more details of the evaluation process currently underway or when a final decision on this potential capex can be expected?
Amit Dahanukar
So we are awaiting decision from the government in terms of the calculation for the pending license fees because this application has been pending with the government for almost 10 years. During this interim period, there was a lot of ambiguity because the Prague was also going through insolvency proceedings. So while we await a pending final outcome from the government, we are readying ourselves that to make ourselves ready for the investment. So subject to approved from the government, the company will consider expanding the capacity at from as you have stated from 6 lakh cases to 36 lakh cases. This is essentially because we are foreseeing a good growth in Andhra Pradesh over the next four, five years horizon. It is a flagship state for us where we have maximum sales coming from Andhra.
So it will not only replace the current capacity which we have, it will supplement it because even after the expansion, we will still require contractual bottling partners, so it will supplement the existing partners. And as and when we take any firm view on this, we will intimate the stakeholders through adequate disclosures.
Chetan
Okay. Yeah, that was helpful. Thank you.
Operator
Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Anjali Bajaj from Investments. Please go-ahead.
Unidentified Participant
Hello, good morning. Congratulations for the good set of numbers. My first question is regarding to how has the price correction impacted the company’s revenue and market-share in Andhra Pradesh? What are the long-term implication of price correction in Andhra Pradesh?
And second question regarding the — how does industry plan to manage and reduce the sales receivable in coming quarters? How much use from the Telangna government as on the 31st March 2024 and 31st March 2025. Thank you.
Amit Dahanukar
Yeah. So as we mentioned, right, after the price reduction, there has been significant growth that we have seen, right? We mentioned earlier on this call that more than 30% growth in Q4 on a year-on-year basis. So obviously, there has been good growth that we have seen in the state. Along with that, we’ve also stated that our market-share has actually increased since this price reduction, right. So there has been inherent benefit that we’ve received from this — from this decision. And we’ve increased the market-share pretty decently as a part of the overall IMFL industry as such.
Unidentified Participant
Okay.
Ameya Deshpande
And on the Telangana front, Madam, since September onwards, thankfully, we have been receiving payments from Telangana government more or less on-time. And there was a sort of a blackout period for us in May and July, August. That payment also has started coming in. So overall, I would say that there are positive signs from the Telangana side.
Unidentified Participant
Okay, thank you.
Operator
Thank you. The next question is from the line of Singh from Sheet Capital. Please go-ahead.
Jasbhir Sing
Hello yes, sir. Hello to please use your handset. Yes, you are what is the update on this so the update is just follows, I think the counterparty in February there was an order which was also allowing another body corporate to use the house trademark in particular state of Well Bengal. So we preferred an appeal against that order before the division bench. And as of now, the fewer is maintained because the other body corporate, they have given an undertaking to the court that they will refrain from, so using the February 7 order till the next date when the appeal will be heard. So as on-date, your status quo is maintained, I wouldn’t, of course, the matter being subjected get into more specific details at this point.
But just two things I would like to add is that we have been the exclusive and uninterrupted users of this mark since 1983 and continue to remain so.
Sir, is there any ban.
Operator
Just how — if you are using this ready to interrupt, sir. We can’t hear you clearly. I would request you to please use your handset.
Jasbhir Sing
Yeah, sorry, ma’am. Now hello.
Operator
Yes, sir, much better, sir. Please go-ahead.
Jasbhir Sing
Yeah. Is there an — because we are using this brand since 1982, what is the history, how one company can go and claim to use this brand in the West Bengal or any other state?
Amit Dahanukar
So those specifics, I would not like to get into beyond what I have already commented earlier, since this matter remains, I think we have made our position clear. So any guidance for the EBITDA margin and the revenue growth for the next financial year in FY ’23. So EBITDA margins will be in the range of 15.
5% to 17% for FY ’26.
Jasbhir Sing
To subsidies.
Amit Dahanukar
And revenue — revenue guidance will be in the upper-teens.
Jasbhir Sing
Okay. So this EBITDA guidance is adjusted to the subsidies.
Ameya Deshpande
Adjusted for subsidy income.
Jasbhir Sing
Okay, sir. Thank you very much, sir.
Operator
Thank you. The next Next question is from the line of Yashovardhan Banka from Tiger Assets. Please go-ahead. Thank you.Thank you. The next question is from the line of Daksh Malhotra from Global. Please go-ahead.
Daksh Malhotra
Yeah, hello, and thank you for the opportunity. Congratulations on the good set of numbers. Wanted to take your view on the UK FTA agreement and how will it impact our luxury portfolio, which we are planning to grow in the near-future? That is question one. And question two, just wanted to get a sense on how are we planning of are we planning to increase our stake in SSL, some Sipara run from 20% in the near-future? Thank you.
Amit Dahanukar
Yeah. On the first part regarding the UK FDA, see, from an existing business perspective, it doesn’t impact us much for the simple reason that we are a predominantly brandy player and Brandy does not get impacted significantly by the UK FDA. With regards to the super-premium luxury business that we have guided towards even with a whiskey launch, to be very frank, see, I think there is a very clear positioning that Indian brands have created for themselves, right, whether it is the Indian single molts or the Indian bolts that are coming in. So we frankly don’t see a significant impact on the — on the industry as such, but time will tell and we don’t want to guide towards anything on that front. Having said that, we do see tremendous and promising opportunities from an Indian luxury play over here.
With regards to Spirit Slab, the intent obviously is to increase our stake, right? It is a strategic investment for us. We by the end-of-the committed investment would be owning around 20.02% in the company and very soon, we’ll be looking at increasing that stake further pretty significantly. And the end game obviously is to — is to have majority in the company and to acquire the company at some point in time, but at the right time.
Daksh Malhotra
Okay, got it. Thank you so much.
Operator
Thank you. The next question is from the line of Dhaval Jain from Sequent Investments. Please go ahead.Yes, sir, I would request you to please use your handset?
Dhaval Jain
Or is it better now?
Operator
Yes, sir.
Dhaval Jain
Hello. Yeah. So I just wanted to understand what exactly — how do we aim to achieve — go about our advertisement expenses going-forward? And is it like a cap to the percentage of sales or a more broader understanding on this front?
Amit Dahanukar
So I can give a broad outlook on that. As a category, we believe has been underinvested in terms of brand-building and marketing. So we have now started investing behind the category. I think one was, of course with introduction of Landy, we did something to reinvigorate the category. And for the first time, I think we’ll also be using a celebrity. We have signed on a celebrity and our teaser campaign has just been rolled-out today as we speak. So there will certainly be more activity on this front in terms of investment behind the brandy category.
And in terms of quantifying your question was also in terms of how do we see this, right, in terms of capping it. See, the thing is that Q4 we build an investment — reinvestment rate of around 1.8% of net revenue, right? For FY ’26, you will look at this at more than 2% as we try building on the entire branding narrative as well as our introduction in the super-premium luxury space, right, even that will require good amounts of investment. So you are looking at an ANSP reinvestment rate of more than 2% for the coming year and our EBITDA guidance, EBITDA margin guidance takes that into consideration as well. O
Dhaval Jain
Okay. One more thing on our volume to volume growth annually. So it’s around 6.7%, if I’m not wrong?,
Amit Dahanukar
That’s right.
Dhaval Jain
So this we expect it to be high mid-teens now like going-forward on FY ’26?
Amit Dahanukar
Yeah, it will be high-teens.
Dhaval Jain
So I just wanted to understand like where exactly this growth is going to come from. From is just the Southern market or is the expansion into new markets or which exactly the states you are targeting at?
Amit Dahanukar
Yes. So it will be significantly from the existing states itself, right? So obviously with — with the whiskey semi-premium whiskey brand being launched in the East and Northeastern states, you will see East and Northeast growing at a decent clip. But at the same time, what we also need to look at is that the first-nine months of this financial year of the financial year that went by, you saw some subdued volume growth, right. So from that perspective, we will be regaining the share from that perspective and that is how we will grow at a high-teens kind of a of a rate in volume terms.
Dhaval Jain
Okay.
Amit Dahanukar
Of both Southern markets as well as your East and Northeastern markets.
Dhaval Jain
Right. And just one more last question. On the front of our case, I understand, but when is the next hearing date on this?
Amit Dahanukar
That is in June or on the 9th of June.
Dhaval Jain
So I understand like last-time it was in April, around April if I’m not wrong.
Amit Dahanukar
Yeah, so the hearings have been taking place, right, but it is status quo as Mr Dhanukar mentioned earlier.
Dhaval Jain
Okay, okay, fine, sir. Thank you.
Operator
Thank you. The next question is from the line of Aditya Singh from Multibanger Stocks. Please go-ahead.
Aditya Singh
Good morning, please. Am I audible?
Operator
Sir, I would request you to please use your handset. Yes, sir, be a little louder.
Aditya Singh
Thank you.
Operator
Yes, sir, you are audible.
Amit Dahanukar
So congratulations on the great set of numbers. I only had one question. And my question was regarding the tax index. So I just heard that there would be more tax index for the June quarter. So can we expect it from the next quarter?
No. So as I said, if you see our carryforward losses are around INR32 crores as of, 31 March 2024, but we have against the assessment order of the income tax and the appeal is now pending at commissioner income tax level. So once that appeal is heard and we are able to know that what exactly has been the additions to our FS income, then only we will be able to exactly give you the guidance since when we can expect the tax. We have just said that for the current quarter, since we are not expecting any adjustment in this quarter, you may assume no tax and exact from when tax will be required to be paid, perhaps by next quarter, we will have a better position to answer.
Aditya Singh
Okay. Thank you so much for taking my question.
Operator
Thank you. Ladies and gentlemen, you may press star and one to ask a question a reminder to all the participants that you may press star and one to ask a question ladies and gentlemen, you may press star and 1 to ask a question.
As there are no further questions from the participants, I would now like to hand the conference over to the management for closing comments.
Amit Dahanukar
Thank you. Thank you everyone for being a part of today’s call and showing interest in our progress. I also invite all of you all to check-out our brand handles on social media, Instagram, Facebook and YouTube where the campaigning featuring the brand extension, Mansion House Package Drinking water campaign featuring one of South India’s biggest superstars. NB would have gone live this morning. I also hope that in the call, we have been able to address your queries. In case you have any pending queries, I request you to reach us at the coordinates mentioned in the presentation. Thank you very much for your time and for supporting us on our growth journey. Thank you.
Operator
Thank you. On behalf of the Industries Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines