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    Som Distilleries & Breweries Limited

    SDBL
    Fast Moving Consumer Goods·17 Nov 2025
    Management Summary

    Som Distilleries reported a mixed Q2 FY26, with total income of ₹270 crores and EBITDA growth of 15.1% to ₹40.5 crores. Gross profit margin expanded, and the IMFL segment showed volume growth. However, beer volumes declined significantly, and IMFL realization per case was lower. The company is optimistic about H2 FY26 with new product launches and market expansion plans, particularly in Karnataka and Uttar Pradesh, and plans to raise ₹200 crores in term debt for capex.

    Highlights

    6

    • Total income reached ₹270 crores in Q2 FY26.

    • EBITDA grew 15.1% YoY to ₹40.5 crores, with a 15% margin.

    • Gross profit margin expanded to 41.06% from 40% in the prior year quarter.

    • Net profit stood at ₹19.5 crores with a 7.2% margin.

    • IMFL segment volume grew to 4.1 lakh cases in Q2 FY26.

    • Successful launch of 'Sunny Beaches' beer in Karnataka, reaching 5,000 outlets quickly.

    Concerns

    3

    • Beer volume declined by 19% to 36 lakh cases in Q2 FY26, primarily due to taxation issues in Karnataka and overall industry slump.

    • IMFL realization per case decreased to ₹939 from ₹1,038 in the same quarter last year, despite premiumization focus.

    • Interest costs have risen sharply due to higher utilization of CC limits for capex, though new term debt is yet to be taken.

    What Changed2

    vs Q3 FY26

    Guidance items5 → 8 (+3)Risks discussed5 → 4 (-1)
    Key financials

    Metrics

    13

    Periods

    2

    Q2 FY26

    8
    • Total Income
      ₹270 Cr
      YoY-7.2%
    • EBITDA
      ₹40.5 Cr
      YoY+15.1%
    • EBITDA Margin
      15%
    • Net Profit
      ₹19.5 Cr
    • Net Profit Margin
      7.2%

    H1 FY26

    5
    • Total Income
      ₹800.1 Cr
    • Gross Margin
      37.6%
    • EBITDA Margin
      14%
      YoY+12.5%
    • PBT
      ₹85.8 Cr
      YoY+4.6%
    • Net Profit
      ₹61.6 Cr

    Capital allocation

    2
    high confidence
    CategoryHeadline
    Capex

    ₹90 crores

    Primarily from CC limits for current quarter spend

    Debt

    Debt disclosed

    Guidance & targets

    8
    CategoryTargetPriority
    Revenue
    H2 FY26 Revenue Addition
    ₹800 crores
    		Medium
    IMFL Revenue Share
    IMFL Revenue Share
    15%
    		Medium
    IMFL Volume Contribution (New Brands)
    Mahavat/Single Malt Volume Contribution
    2-3% (1-2 years), 3-5% (2-3 years)
    		Medium
    Beer Market Share (New States)
    Market Share in Odisha and Karnataka
    5-7%
    		Medium
    Ad Spend
    Ad Spend as % of Revenue
    2-3%
    		Medium
    UP Plant Commissioning
    UP Plant Operational Status
    Running
    		High
    UP Plant Capacity
    UP Plant Annual Capacity
    10 million cases
    		High
    Airport Channel Availability
    Woodpecker/Single Malt in Bangalore Airport
    Available
    		High

    H2 FY26 Revenue Growth

    H2 FY26
    CurrentQ2 FY26 Total Income: ₹270 crores
    TargetAddition of ₹800 crores in H2 FY26

    Why it matters

    To assess if the company can achieve its ambitious H2 revenue target after a subdued Q2, which is crucial for full-year performance.

    But as of now, we could look at adding another INR 800 crores of revenue for the remaining 6 months.

    How to verify

    key_financials.metrics[label='Total Income (H1 FY26)']

    Risks & concerns

    4
    RiskSeverity

    Beer volume decline

    Beer volume down 19% in Q2 FY26, mainly due to taxation issues in Karnataka and overall industry slump, impacting overall growth. — Management acknowledged

    medium

    IMFL realization pressure

    IMFL realization per case decreased due to product mix changes, with lower realization SKUs in higher demand, potentially impacting profitability per unit. — Management acknowledged

    low

    Litigation regarding promoter shares

    Management refused to comment on promoter shares attached by the High Court, citing ongoing litigation, which raises concerns about transparency and potential legal liabilities. — Analyst deflected

    high

    Tough market entry in Maharashtra

    Maharashtra market has a tough route to market and channel behavior, leading to selective and cautious entry, potentially limiting growth in a large consuming state. — Management acknowledged

    medium

    Q&A highlights

    8

    “See, the guidance is given based upon our expectations for the quarter, but some things are also beyond our control, including the government regulations. We are in an industry where the government plays a very important role. So, having said that, we are expecting that we should do better than what we have done in the first half of the year. But as of now, we could look at adding another INR 800 crores of revenue for the remaining 6 months.”

    Analyst challenged management on previous guidance misses, leading to a new H2 revenue target of ₹800 crores, which is a key forward-looking metric.

    asked by Mukund Agarwal

    3 min read7 chapters

    Detailed Narrative

    01

    Q2 FY26 Performance Overview

    Som Distilleries reported a total income of ₹270 crores for Q2 FY26, marking a 7.2% decrease year-on-year. Despite this, EBITDA grew by 15.1% to ₹40.5 crores, achieving a 15% margin. Net profit for the quarter was ₹19.5 crores, with a 7.2% margin, while the gross profit margin expanded to 41.06% from 40% in the corresponding quarter of last year.

    02

    Beer Segment Challenges and Recovery

    The beer volume performance in Q2 FY26 was 36 lakh cases, down approximately 19% year-on-year. This decline was primarily attributed to taxation issues in Karnataka and an overall slump in the beer industry. Management expressed confidence in a recovery during Q3 and Q4, particularly from Odisha and Karnataka, citing improved October performance and the successful launch of 'Sunny Beaches' beer in Karnataka, which has already reached 5,000 outlets.

    03

    IMFL Segment Growth and Premiumization Strategy

    The IMFL segment recorded 4.1 lakh cases in Q2 FY26, driven by legacy brands like Black Fort and Milestone, and strong performance from Mahavat in Madhya Pradesh and Delhi. The company is focusing on premiumization within IMFL, with plans to introduce single malt liquor and expand Mahavat across Northern India. While IMFL realization per case was ₹939, down from ₹1,038 last year, management attributed this to product mix changes and the early stage of new premium brand penetration.

    04

    Greenfield Project in Uttar Pradesh

    The Phase-1 greenfield project in Farrukhabad, Uttar Pradesh, is on track for completion by FY27. This integrated facility, under the wholly-owned subsidiary Woodpecker Greenagri, aims to enhance brand availability in UP and the Northern region. The company has invested approximately ₹90 crores in this plant during the quarter and plans a total investment of ₹350 crores, with the plant expected to be operational by June 2026 with a capacity of 10 million cases per annum.

    05

    Market Expansion and Distribution Focus

    Som Distilleries is consolidating its market share in states like Odisha and Karnataka, where it expects significant recovery. The company is also cautiously expanding into new markets, with plans to launch single malt and Woodpecker in Mumbai within 2-3 months. Efforts are underway to enter Andhra Pradesh, with tender approval received, and the company has successfully placed brands in Delhi airport (T1 and T3) and is pursuing availability in Bangalore airport by December.

    06

    Financial Margins and Cost Management

    Gross profit margin expanded to 41.06% in Q2 FY26, up from 40% last year, and PBT margin improved to 10.17% from 8.94%. Management noted that the high margins were partly due to efficient returnable glass bottle management. 'Other costs' saw a drop to ₹58 crores from ₹70 crores last quarter, which management explained can vary quarter-to-quarter due to transportation, rebates, commissions, and promotional expenses.

    07

    Capital Allocation and Debt Plans

    The company's interest costs have risen due to higher utilization of CC limits for investments in the Woodpecker Greenagri plant. Som Distilleries plans to take on approximately ₹200 crores of term debt over the next six months to support its ongoing capital expenditure. Related party transactions include buying ENA from Som Distilleries Private Limited, amounting to ₹20-21 crores annually.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.