Key highlights of the call

• The net sales for Q2 FY16 inclined by 19% YoY to Rs 161.8 crore driven by robust growth in IMIL and others by-products segment. EBIDTA grew by 17% to Rs 13.3 crore with EBIDTA margin 8.2% (down 20 bps YoY). The net profit increased by 2% YoY to Rs 1.3 crore.

• For Q2, 2.9 mn IMIL cases sold.

• IMIL revenues increased by 54% YoY to reach Rs 86.9 crore due to sustained double-digit revenue growth in Rajasthan IMIL (40%), robust growth in Delhi (68%), revival in Haryana (16%) and Bihar launch.

• In Rajasthan, 1.69 mn cases in sold. Revenue grew 40% to Rs 55.4 crore.

• In Haryana, 0.57 mn cases in sold. Revenue grew 16% to Rs 16.4 crore.

• In Delhi, 0.18 mn cases in sold. Revenue grew 68% to Rs 4.8 crore

• Launched in January 2015, Bihar sold 0.5 mn cases in Q2 accounting for 17% of total IMIL sold in Q2.

• Bulk alcohol revenue declined by 9% YoY due to lower realization.

• Bottling volumes de-grew 1% YoY; while Haryana witnessed strong 47% YoY growth in the quarter, Rajasthan volumes were down 30% YoY due to some transitory challenges faced by franchise customers in the state.

• Others segment grew 46% 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.

• The company expects margin in bulk alcohol to go up from fuel ethanol mix mandate by govt. The mgmt expects realization to go up by 15-20%.

• Gross margin improved because of better by-product realization and revenue mix.

• EBIDTA margin down due to rebate of Haryana IMIL and packaging expenses related to export of bulk alcohol.

• Receivables have gone up due to country liquor sales and also due to increase in export. IMIL has credit period of 30 – 45 days.

• Export sales in Q2 was Rs 12 crore.

• ENA price in Haryana is at Rs 38 – 40, in Rajasthan at Rs 44 – 45 per liter. In WB and Bihar, prices are higher, Rs 50 per liter.

• DDGS revenue every quarter is around Rs 13.7 crore

• Rs 10-15 crore maintenance capex for FY16 and FY17.