Som Distilleries & Breweries Limited , a prominent player in the Indian alcoholic beverage market, reported mixed results for the first quarter of fiscal year 2026, navigating through market challenges and policy changes.

Financial Performance

The company reported a total income of Rs. 5,301.00 million for Q1 FY26, marking a 3.20% year-over-year growth. Despite the modest top-line growth, Som Distilleries managed to maintain profitability with an EBITDA of Rs. 721.00 million and a net profit of Rs. 421.00 million.

Volume Analysis

Total volume reached 8.90 million cases during the quarter. While beer volumes declined by 2.50% to 8.50 million cases, the Indian Made Foreign Liquor (IMFL) segment showed strong growth, surging 58.00% to 0.40 million cases.

Market Challenges

Som Distilleries faced significant headwinds in Karnataka, a key market for the company. Unseasonal rains and excise duty hikes led to a volume decline of over 20.00% in the state. This resulted in a reduction of the company's market share in Karnataka from 17.50-18.00% to 12.50-13.00%.

Product Performance

Despite the challenges, the company's mainline brands Hunter and Power Cool showed growth. The beer realization improved to Rs. 566.00 per case from Rs. 550.00 in the previous year.

New Product Launch

Som Distilleries launched Mahavat Whisky, a mid-premium whisky, in Madhya Pradesh. The initial response has been positive, indicating potential for growth in the IMFL segment.

Expansion Plans

The company is constructing a new brewery in Uttar Pradesh with a planned capital expenditure of Rs. 370.00 crores. The facility is expected to be commissioned in the first half of FY27 with a capacity of 10.00 million cases.

Outlook

While Som Distilleries has revised its full-year revenue growth guidance to 15.00-17.00% from the earlier 20.00-22.00%, management expects recovery in the coming quarters. This optimism is partly due to the partial rollback of excise duties in Karnataka and anticipated growth in other markets.

Management Commentary

Diwakaran Suryanarayana, Chief Operating Officer, stated, "We expect reasonable recovery in industry and our own volumes in the coming quarters. We will continue to focus on growth drivers and innovation in both IMFL and beer segments."

Nakul Sethi, Director of Finance and Strategy, added, "We remain confident in our strategy and execution capabilities as we continue to build, scale, expand reach, and drive growth across our key markets."

Som Distilleries & Breweries Limited continues to navigate through market challenges while focusing on expansion and product innovation to drive future growth.

Som Distilleries & Breweries Limited (SDBL) has unveiled an ambitious growth strategy, targeting Rs 2,000 crore in revenue by FY27, with a significant focus on expansion in Uttar Pradesh (UP) and a shift towards premium spirits.

Uttar Pradesh Expansion

The company is betting big on UP, expecting the state to contribute Rs 400 crore to its revenue in FY26 and Rs 600 crore in FY27. This projection comes on the heels of SDBL's announcement in March of a Rs 600 crore investment in the state, underlining its commitment to growth in this market.

Conservative Estimates and Historical Performance

Managing Director Jagdish Kumar Arora expressed confidence in these projections, noting that they are conservative estimates. He highlighted the company's track record of surpassing its own projections, suggesting potential for even stronger performance.

Strategic Shift to Premiumisation

SDBL is pivoting its focus towards premiumisation and the Indian Made Foreign Liquor (IMFL) segment. This strategic shift includes the launch of new products, with a notable upcoming release being the premium single malt 'Bheembetka'. The move away from beer is attributed to slowing growth due to increased taxation in that segment.

IMFL Segment Growth

Currently, the IMFL segment represents less than 10% of SDBL's sales. However, the company expects this to grow significantly, reaching 20% by FY27. This segment is particularly attractive due to its higher margins compared to beer.

Q1 FY26 Financial Performance

SDBL reported robust financial results for Q1 FY26:

Stock Performance

Despite the positive outlook and strong quarterly results, SDBL's shares closed at Rs 140.00, down 7.44%.

Earnings Conference Call

As per the LODR data, SDBL held an Earnings Conference Call on August 12, 2025, to discuss the unaudited financial results for Q1 FY2026. The audio recording of this call has been made available on the company's website, demonstrating Som Distilleries & Breweries Limited's commitment to transparency and investor communication.

SDBL continues to adapt its strategy to market conditions, focusing on high-margin segments and geographical expansion to drive growth in the coming years.