Q1 2027 Som Distilleries and Breweries Ltd Earnings Call Transcript
Key Points
- Strong rebound in Karnataka with a 30% increase in cases sold and improving market share.
- Odisha delivered a strong recovery, demonstrating brand resilience and distribution network strength.
- Successful commissioning and commencement of commercial production at the new Uttar Pradesh facility, adding 10 million cases of annual beer capacity.
- Disciplined balance sheet with gross debt increasing by only INR10 crores despite significant capex, maintaining a low debt-to-equity ratio of 0.31x.
- Healthy cash generation of approximately INR28 crores from operations during the quarter, indicating underlying financial strength.
- MFL realization improved by approximately 3% year-on-year, reflecting a focus on higher-value products.
- UP facility investment of INR300 crores was made without external debt, preserving financial flexibility.
- Significant operational and regulatory disruption in Madhya Pradesh, leading to a loss of approximately INR250 crores in revenue.
- Madhya Pradesh plant closure has resulted in fixed costs of INR6-7 crores per quarter, including interest, salaries, and electricity.
- Uncertainty regarding the timeline for resumption of Madhya Pradesh operations, with legal proceedings causing delays.
- Risk of losing market share in Madhya Pradesh due to prolonged brand unavailability, with consumer reacquisition expected to be challenging.
- Raw material costs, particularly canned malt bottles, increased by 7.5-8% year-on-year, pressuring margins.
- Dependence on a single supplier for cans (Bulk Corporation) poses a supply chain risk.
- Management refrained from providing a clear plan B or detailed FY27 guidance if Madhya Pradesh operations do not resume, creating uncertainty.
Ladies and gentlemen, good day and welcome to the SOM Distilleries and Braveries Limited Q1 FY27 earnings conference call.
(Operator Instructions)
I now hand the conference over to Mr. Diwakaran.
Thank you and over to you sir.
Thank you. Uh, good afternoon everyone. My name is Deewakaran and Iâm the Chief Operating Officer of Som Distilleries Breweries Limited. Thank you very much for joining us for the Q1 26to27 earnings call of Som Distilleries Breweries Limited. Let me begin by acknowledging that Q1 was an extremely difficult quarter for the company. The operational and regulatory disruption in Madhya Pradesh had a significant impact on our volumes and consequently on our financial performance. Despite the disruption, there are some positives which, which is, which is very good.
We saw a strong rebound in Karnataka. With improving demand and market share. Odisha also delivered a strong recovery, demonstrating the resilience of our
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