Tilaknagar industries first ever concall Q1FY24 notes :-
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After whiskey , brandy is the 2nd largest category in IMFL . Brandy has 20% IMFL volume share .
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Past super growth came from leverage , now growth with deleveraging the company.
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90% of the company’s volumes come from brandy .
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Flagship brandy mansion house brandy largest selling brandy in india . 40% + growth in flagship brands mansion house , korean napoleon brandy .
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Only company in asia to try flavoured brandy mixes
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Working on innovations towards premium brandy .
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Relaunch of blue lagoon brand ( entry level gin)
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80% volume of brandy for the company comes from prestige and above segment
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Continuous increase of market share .
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Net per case realisation Rs 1250 vs Rs 1157 (YoY)
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Company majorly operates in the southern region with 85% contribution of overall volumes of the co.
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Near full capacity utilisation at 2 of their units.
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100 KLpd greenfield project
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Exploring newer geographies such as eastern and north eastern ( seeing good tractions from sikkim region)
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Q1 YoY Volume growth 42% ( exceptional growth due to last year’s lower base )
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Overall the IMFL industry growing at 12% ( according to management).
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Margins dependent on state and brand mix .
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Medium to long term will explore outside brandy .
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Gross debt reduced from 1200 crs ( peak ) Vs 239 crs ( June 2023)
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Refinancing cost at 13%
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Interest cost at 6 cr vs 13.4 crs (YoY)
Going forward
- Margins shall be in the range of 13-14% ( As volumes increases company operating leverage shall kick which can possibly lead to margins expansion
- For FY24 , Volumes growth to be in mid teens and on longer term towards low double digits to mid teens .
- Addressable market growing at low double digits.
- 100 KLpd greenfield project , (will cost above 50 crs and below 100 crs)
- From next FY onwards normal capex of 25 crs.
- No leveraged expansion going forward.
- Goal is to become net debt free in 5-6 quarters .
- No taxes for FY24 ( 160 cr accumulated tax losses in the book). From FY25 taxes shall be applicable .
- Marketing spends shall increase as business has moved from consolidation to growth phase .
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