During Thursday’s trading session, the shares of the third largest spirits company in India by annual sales volume in FY24 surged nearly 8.6 percent to Rs. 423.45 on BSE, after the company reported a turnaround from a loss of Rs. 4 crores in Q3 FY24 to a profit of Rs. 57 crores in Q3 FY2
With a market cap of Rs. 11,040.2 crores, the shares of Allied Blenders and Distillers Limited closed in the green at Rs. 394.7, up by around 1.3 percent, as compared to its previous closing price of Rs. 389.75.
What’s the news
The fluctuations in the share prices were observed after Allied Blende and Distillers Limited announced the financial results for Q3 FY25, throu the recent filings with the stock exchange
For Q3 FY25, Allied Blenders reported revenue from operations of Rs. 977 crores, registering a significant increase of around 12.4 percent QoQ fr Rs. 870 crores in Q2 FY25, as well as a rise of about 9 percent YoY from Rs. 897 crores in Q3 FY24.
This growth was primarily driven by strong consumer demand during the festive season and a volume growth across all 4 millionaire brands in P&A and Mass Premium categories.
The company’s net profit for Q3 FY25 grew to a profit of Rs. 57 cro representing a significant rise of around 20.8 percent QoQ from Rs. crores in Q2 FY25, and a significant turnaround from a net loss of Rs. crores in Q3 FY24. This robust performance in PAT was led by strong EBITDA growth.
EBITDA for Q3 FY25 rose to Rs. 120 crores, a 14 percent QoQ growth compared to Rs. 105 crores in Q2 FY25, and an impressive 94.7 percent YoY increase from Rs. 62 crores in Q3 FY24.
The strong performance in EBITDA was driven by the company’s continued strong focus on profitable state brand mix and co optimization initiatives.
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Company Outlook
The management expects double-digit volume growth in the January-March 2025 quarter (Q4 FY25). Allied Blender’s Managing Director, Alok Gupta, emphasized that the company’s strategy and brand portfolio are being aligned to achieve 15 percent margins over the next 2-3 years.
The company recently acquired a 51 percent stake in Good Barrel Distillery, the maker of the premium rum brand, Rock Paper Rum, for Rs. 9 crore. The agreement includes an option to increase the stake to 100 percent over time.
Allied Blenders sees significant growth potential in this brand, which h emerged from the dynamic startup ecosystem. The focus is on leveraging the commitment of the founder and CEO to expand the brand both in India and internationally.
The rum brand operates in a market segment with a size of 3 to 4 million cases, offering high gross margins and consistent double-digit growth, which aligns with Allied Blenders’ premiumisation strategy.
The company’s EBITDA margin stood at 12.3 percent in Q3 FY25, and management anticipates it will exceed 15 percent within the next 3 years. The current gross margin stands at 42.8 percent, with a target range of 42-45 percent over the same period.
Stock Performance
The stock has delivered positive returns of nearly 24 percent in one year, as well as around 28 percent returns in the last six months. Similarly, the shares of Allied Blenders have given negative returns of about 7 percent in the last one month.
About the Company
Allied Blenders and Distillers Limited is the third largest Spirits company in India, in terms of annual sales volumes between FY14 and FY24.
The company has a presence in five main flavors, i.e., whisky, brandy, vodka, and gin, with ‘millionaire’ brands like Officer’s Choice Whisk Officer’s Choice Blue Whisky, Sterling Reserve Premium Whiskies a ICONiQ White Whisky.
Currently, its manufacturing network comprises 36 units, of which 9 are owned bottling units, 2 owned distilleries, and 25 non-owned manufacturing units.
Written by Shivani Singh
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