Globus Spirits (GSL) held a conference call for discussing the results for the quarter ended June 2015. Mr. Ajay Swarup, MD and Dr. Bhaskar Roy, ED, addressed the call.

Key highlights of the call

The mgmt said that IMIL is growing at faster pace than IMFL.

The net sales for Q1 FY16 inclined by 12% YoY to Rs 157.8 crore driven by robust growth in IMIL and others by-products segment. EBIDTA grew by 28% to Rs 15.8 crore with EBIDTA margin 10% (up 120 bps YoY). EBITDA expanded primarily due to decrease in raw material cost because of lower grain prices and improved productivity. The net profit increased by 61% YoY to Rs 3.5 crore.

For Q4, 2.8 mn IMIL cases sold.

IMIL revenues increased by 54% YoY to reach Rs 84.5 crore due to sustained double-digit revenue growth in Rajasthan IMIL (42%), robust growth in Delhi (61%), revival in Haryana (15%) and Bihar launch.

In Rajasthan, 1.64 mn cases in sold in Q1, up by 33%. Revenue grew 42% to Rs 53.8 crore.

In Haryana, 0.57 mn cases in sold in Q1 up by 12%. Revenue grew 15% to Rs 16.2 crore. Haryana market arrested its decline. Relaization grew by 2%.

In Delhi, 0.18 mn cases in sold in Q1 up by 50%. Revenue grew 61% to Rs 4.7 crore

Launched in January 2015, Bihar sold 0.5 mn cases in Q1 accounting for 16% of total IMIL sold in Q1.

Bulk alcohol volume declined by 29% YoY due to higher allocation to higher margin IMIL business.

Bottling volumes grew 5% YoY; while Haryana witnessed strong 62% YoY growth in the quarter, Rajasthan volumes were down 27% YoY due to some transitory challenges faced by franchise customers in the state at start of the financial year

Others segment grew 66% in the quarter driven by value added DDGS with dryers being operational at both the plants

Bihar and WB distillery expected to be operational during middle of FY17. The combined capacity will be 60 mn BL, which will take capacity from current 90 mn BL to 150 mn BL.

Capex for Bihar and WB distillery is around Rs 240 crore. Debt will be around Rs 150 crore.

The company has exclusive marketing rights in Patna municipality as per 5-year tender, the biggest district market in Bihar, which as per company has potential of 2.5 mn cases p.a.