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    Tilaknagar Inds.

    TI
    Fast Moving Consumer Goods·30 May 2026
    Management Summary

    Tilaknagar Industries reported robust Q4 and FY26 results, driven by strong volume growth from the Imperial Blue acquisition and its existing brands. The company achieved significant revenue and EBITDA growth, expanded capacity, and made progress on TSMA integration. While facing some short-term disruptions and input cost pressures, management remains focused on margin expansion, debt reduction, and strategic portfolio growth.

    Highlights

    5

    • Achieved almost 20 million cases volume in FY26, with Imperial Blue contributing for only 4 months.

    • Mansion House Brandy crossed the 10 million cases volume benchmark in FY26, cementing its position as India's largest P&A brandy.

    • Overall volumes increased by 135% YoY in Q4 FY26, crossing 8 million cases.

    • Net Revenue for Q4 FY26 grew 148% YoY to INR 949 crore.

    • EBITDA for Q4 FY26 grew 97% YoY to INR 155 crore, clocking a margin of 16.3%.

    Concerns

    4

    • Incurred an exceptional expense of INR 63 crore during Q4 FY26, predominantly due to TSMA fees and labor code changes.

    • Faced small business disruptions in the first couple of weeks of April (Q1 FY27) due to TSMA exit in some states.

    • Expect some pressure on input costs and margins due to the current geopolitical scenario.

    • Telangana dues from January onwards have been stable but remain outstanding.

    Key financials

    Metrics

    10

    Periods

    2

    Q4 FY26

    7
    • Overall Volumes
      8 Mn
      YoY+135%
    • IB Volumes
      4.6 Mn
    • Net Revenue
      ₹949 Cr
      YoY+148%
    • EBITDA
      ₹155 Cr
      YoY+97%
    • EBITDA Margin
      16.3%

    FY26

    3
    • Revenues
      ₹2,346 Cr
      YoY+70%
    • EBITDA
      ₹419 Cr
      YoY+64%
    • Adjusted EBITDA
      ₹352 Cr
      YoY+56.0%

    Capital allocation

    4
    high confidence
    CategoryHeadline
    Capex

    ₹25 crores

    Debt

    Gross ₹2,295 crores · Net ₹1,911 crores

    Dividend

    ₹1/share (final)

    M&A

    Imperial Blue business

    acquisition · integrated · Consideration ₹NaN (undisclosed)

    Guidance & targets

    10
    CategoryTargetPriority
    Volume
    Combined Business Volume Growth
    high-single digit to low-double digit
    		High
    Margin
    Consolidated EBITDA Margin
    16%-18%
    		High
    Debt
    Net Debt-to-EBITDA Ratio
    below 1.0x
    		High
    Debt
    Net Debt
    approximately INR 1,700 crore
    		High
    TSMA Exit
    States under TSMA
    1 state
    		High
    TSMA Exit
    TSMA full transition
    complete
    		High
    TSMA Fees
    Full year TSMA fees impact
    INR 55 crore to INR 60 crore
    		Medium
    Capex
    Maintenance Capex
    INR 25 crore
    		High
    Working Capital
    Working Capital Cycle
    53 to 55 days of gross revenue
    		High
    Investment
    Nigeria Subsidiary Investment
    up to INR 30 crore
    		High

    TSMA transition completion for remaining states

    Next few quarters, outer date March-27
    Current3 states remaining, 75% exited by Q4 FY26
    TargetFurther reduction in states under TSMA, with only 1 state continuing into H2 FY27

    Why it matters

    Completion of TSMA exit is crucial for full operational control, cost optimization, and realizing integration synergies.

    Now only 3 states remain under TSMA, and we expect to transition them over the course of the next few quarters with an outer date of March-27. ... In all likelihood, there will be only 1 state which will continue in TSMA into the second half of this financial year

    How to verify

    guidance_and_targets[category='TSMA Exit'].target_value

    Risks & concerns

    3
    RiskSeverity

    Input cost inflation due to geopolitical scenario

    Expects some pressure on input costs and margins, but working on cost optimizations to mitigate impact. — Management acknowledged

    medium

    Small business disruptions from TSMA exit

    Experienced disruptions in early Q1 FY27 but team managed to deliver record volumes in May. — Management acknowledged

    low

    Telangana dues outstanding

    Dues have been stable since January, actively working with government to reduce outstanding amounts. — Management acknowledged

    medium

    Q&A highlights

    8

    “So one of the reasons is that Q4 last year in Andhra Pradesh was very high because the route to market has just recently changed in October / November of 2024. The route to market change led to sales of Andhra Pradesh being very high in Q4 FY25. So that was predominantly the reason. But on a secondary basis, if you see our existing business - it has grown by around 5%. ... IB is slightly more equally distributed among the quarters. Having said so, H2 does form around 52% of the volumes.”

    Explains the ex-Imperial Blue performance and provides insight into the seasonality of the newly acquired Imperial Blue business, which is crucial for future modeling.

    asked by Chetan Mahadik

    2 min read7 chapters

    Detailed Narrative

    01

    Q4 & FY26 Performance Highlights

    Tilaknagar Industries reported robust Q4 FY26 results, with overall volumes surging by 135% year-on-year to 8 million cases, including 4.6 million cases from Imperial Blue. Net Revenue for the quarter grew 148% to INR 949 crore, and EBITDA increased by 97% to INR 155 crore, achieving a 16.3% margin. For the full year FY26, revenues climbed 70% to INR 2,346 crore, and EBITDA rose 64% to INR 419 crore, reflecting strong operational performance.

    02

    Imperial Blue Integration and Volume Milestones

    The company achieved a significant milestone of almost 20 million cases in FY26, with Imperial Blue contributing for only four months of ownership. Mansion House Brandy also crossed 10 million cases in FY26, solidifying its position as India's largest P&A brandy. The integration of Imperial Blue is progressing, with 75% of the business having exited TSMA by Q4 FY26, and the remaining states expected to transition by March 2027.

    03

    Strategic Focus and Margin Expansion

    Management outlined a strategy to achieve double-digit volume growth, optimize supply chain for operating leverage, and reduce net debt-to-EBITDA below 1.0x by FY29. The company targets consolidated EBITDA margins of 16%-18% over the next 24-36 months, building on the FY26 adjusted margin of 15.5%. This expansion is expected to be driven by cost optimizations, operating leverage from growth, and potential price increases.

    04

    Capacity Expansion and Cost Savings

    Tilaknagar Industries received government approval to commence operations at its expanded Prag facility in Andhra Pradesh, boosting capacity from 6 lakh to 36 lakh cases per annum. This INR 59 crore investment is fully deployed and is projected to generate bottling cost savings of INR 10 crore annually. This expansion underscores the company's commitment to securing supplies and long-term capacity planning.

    05

    Financial Position and Shareholder Returns

    As of March 31, 2026, the company reported gross debt of INR 2,295 crore and net debt of INR 1,911 crore. Management aims to reduce net debt to approximately INR 1,700 crore by March 2027. The Board of Directors has recommended a final dividend of INR 1 per share for FY25-26, signaling confidence in the company's financial health and future outlook.

    06

    Revenue Recognition Change and Impact

    The company implemented a change in its revenue recognition policy, now showing selling expenses (discounts, schemes) as a reduction from gross revenue, rather than under 'Other Expenses'. This adjustment negatively impacts reported revenue and gross margins but positively influences EBITDA and PAT margins, with no change to absolute EBITDA, PAT, or EPS, enhancing comparability with industry peers.

    07

    Market Dynamics and Policy Impact

    A progressive excise policy change in a key state (Karnataka) led to a consumer price reduction of INR 20 per nip for Imperial Blue Whiskey and Mansion House Brandy, with expectations of further volume uptake. The company also noted that Telangana dues have remained stable since January, and efforts are ongoing to reduce the outstanding amounts, addressing a persistent concern.

    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.