1.At a Glance
Associated Alcohols & Breweries Ltd (AABL) is living proof that in India, liquor may flow slower than bureaucracy — but it flows profitably. With amarket cap of ₹2,216 crore, the company’s Q2FY26 results show it’s trying to balance a hangover from the previous quarter with a new ethanol buzz.
Revenue came in at₹254 crore, down0.3% QoQ, while profit after tax dipped8.5%to ₹14 crore. But before you say “cheers to mediocrity,” remember — AABL still managed anOPM of 9%, anROCE of 20%, andROE of 17.3%. TheP/E of 25.7xlooks sober next to Radico Khaitan’s drunken 95x, proving that not all spirits are overpriced spirits.
The stock has been on a mild buzz:+13.5% in 3 monthsand+24% in 1 year, with the price sitting pretty at ₹1,168. Promoters have upped their stake to61.2%, debt remains a light₹75 crore, and the CRISIL rating is nowA-/Positive.
In short: AABL is like that disciplined drinker who enjoys his Scotch but still drives home responsibly.
2.Introduction
There are liquor companies that make headlines for luxury launches and celebrity endorsements. And then there’s Associated Alcohols & Breweries — the quiet distiller from Madhya Pradesh that’s been spiking India’s GDP since 1989, one peg at a time.
Operating in theIMIL (Country Liquor)andIMFL (Indian Made Foreign Liquor)segments, the company commands a solid20–25% market share in Madhya Pradesh, and has now expanded its drunken footprint to Kerala, Delhi, and West Bengal. You’ll find its brands in bars, dhabas, and weddings alike — proving that AABL is the great social equalizer.
And while most competitors are busy discussing “premiumization,” AABL decided to go full swadeshi: setting up a₹150 crore ethanol plantto serve India’s fuel blending mission. Ethanol might not get you tipsy, but it sure gets the government’s attention — and that’s worth more than a whisky ad these days.
Recently, AABL even joined the premium club withHillfort Blended Malt WhiskyandNicobar Gin, both already winning medals and headlines. The company’s strategy is clear — sell enough country liquor to the masses to afford gin for the classes.
So, what’s brewing inside this ₹2,000 crore distillery empire? Let’s soberly decode it.
3.Business Model – WTF Do They Even Do?
AABL operates in four verticals — each one catering to a different kind of Indian consumer:
- IMFL & IMIL (54% of 9M FY25 Revenue):This is the bread, butter, and bottle opener of the company. Proprietary brands includeCentral Province Whisky, Jamaican Magic Rum, Superman Fine Whisky,andHillfort Malt.It also manufactures global legends likeBagpiperandMcDowell’s No. 1under license.
- Ethanol (24% of 9M FY25 Revenue):Launched in January 2024, the ethanol plant in Barwaha is producing28 million litresannually at ₹72/litre. The company now supplies directly to oil marketing companies — effectively turning booze into fuel, literally.
- Merchant ENA (12% of Revenue):AABL also sellsExtra Neutral Alcohol (ENA)— the base for spirits — to other distillers. Think of this as “B2B booze,” where the margins are lower but the volume makes you giddy.
- Others (10%):Includes contract manufacturing for Diageo and sale of by-products like DDGS (used in cattle feed — even cows benefit from AABL’s business).
Essentially, the company is vertically integrated — from fermenting grain to bottling whisky. With45 MLPA ENA capacityand16 million annual case bottling capacity, it’s a self-contained alcohol ecosystem.
The newest bet?Premiumization— because the desi drinker is now graduating from plastic bottles to glass.
4.Financials Overview
| Metric | Q2FY26 | Q2FY25 | Q1FY26 | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 254 | 255 | 267 | -0.3% | -4.9% |
| EBITDA (₹ Cr) | 24 | 25 | 37 | -4.0% | -35.1% |
| PAT (₹ Cr) | 14 | 15 | 24 | -6.7% | -41.7% |
| EPS (₹) | 7.38 | 8.47 | 13.09 | -12.8% | -43.6% |
The quarterly slowdown came after a fiery Q1, thanks to ethanol ramp-up delays and lower licensed brand volumes. But hey, at least margins didn’t evaporate completely.
The annualized EPS (₹7.38 × 4 =
₹29.5) implies aP/E of ~39.6x, slightly higher than the TTM P/E of 25.7x — which means the market expects a comeback party next quarter.
5.Valuation Discussion – Fair Value Range
Let’s calculate some fair-value sanity checks, using real math, not cocktail napkins:
a) P/E Method
- TTM EPS = ₹47.2
- Industry PE = 33x
- Company PE = 25.7x→ Fair range = ₹47.2 × (25–33) =₹1,180–₹1,560
b) EV/EBITDA Method
- EV = ₹2,275 Cr
- EBITDA (FY25) = ₹136 Cr
- EV/EBITDA = 16.7xPeers trade between 18x–22x (Radico 22x, Allied 21x, Tilaknagar 28x).→ Fair EV range = 18–22 × 136 = ₹2,450–₹2,992 Cr→ Fair price =₹1,250–₹1,520per share
c) DCF Method (simplified)Assuming:
- FY25 PAT ₹86 Cr growing 12% CAGR next 5 yrs
- Terminal growth 3%
- Discount rate 11%→ Fair equity value = ~₹2,350–₹2,550 Cr →₹1,200–₹1,300 per share
🧾Fair Value Range: ₹1,180–₹1,560/share(This fair value range is for educational purposes only and is not investment advice.)
6.What’s Cooking – News, Triggers, Drama
If liquor companies were soap operas, AABL would be the underrated but consistent character. Here’s the latest gossip from its dramaverse:
- CFO Drama:The long-time CFO Tushar Bhandari resigned (but stays as Whole Time Director — very Bollywood retirement). New CFODilip Kumar Inanitook charge on8 Nov 2025.
- MOA Amendment:Board approved a new clause to allowcaptive electricity generation— because nothing says “sustainable drinking” like making your own power.
- Fundraise Buzz:Converted9,00,000 warrants into sharesin Sept 2025, adding ₹32.7 crore to reserves. Another11 lakh warrantswere issued earlier at ₹679 each. Clearly, promoters are drinking their own brew.
- Product Launch Parade:AfterNicobar Gin(Bronze Medal winner at SFWSC),Hillfort Whiskyrolled into Maharashtra and Uttar Pradesh. Next up:Premium Brandy (Q1FY26)andTequila (Q2FY26). Viva la desi tequila!
- Ethanol Allocation:Received allocation for29,724 KLethanol supply under the national Ethanol Blending Programme.
- CCI Case:The Competition Commission’s old “price cartel” ghost still lingers, but
