Allied Blenders & Distillers Ltd IPO

The parent company of some well-known alcohol beverages- Officer’s Choice and Jolly Roger, Allied Blenders & Distillers Ltd has recently received the green signal from SEBI to float an IPO. The spirits manufacturer had filed its Draft Red Herring Prospectus back in June 2022. It has proposed a Rs. 2,000 crore IPO in its offer documents to settle certain outstanding borrowings availed by the company. 

If you are intrigued by this growing liquor industry you can consider investing in Allied Blenders and Distillers IPO. Read along for further insights.

About Allied Blenders and Distillers Ltd.

Allied Blenders & Distillers Ltd, a Mumbai-based liquor company established in 2008 is the biggest Indian-owned, Indian-made foreign liquor (IMFL) company. It is also India’s third-largest IMFL company in terms of its annual sales from FY14 to FY21. It is also among one of the four liquor companies that has a sales and distribution network all over the country and it’s the leading exporter of IMFL in terms of its volume of sales.

The company owns several popular alcohol brands such as Officer’s Choice, Sterling Reserve, Jolly Roger, Class 21, and Kyron. Allied Blender’s flagship brand Officer’s Choice is among the top-selling whisky brands in India. Its distilleries are situated in Rangapur and Telangana over a built-up area of more than 25,000 square metres along with nine bottling facilities.

Over the years, it expanded its product portfolio across various segments by introducing rum, whisky, brandy and vodka. It has established itself as a market leader in the Indian alcoholic beverage market with a market share of 8.2% in terms of sales volume. Its products are sold across 20 countries including Malaysia, Indonesia, Russia, Qatar, Oman, UAE, Singapore, South Africa and the USA.

Details and Objectives of Allied Blenders and Distillers

Allied Blenders & Distillers Ltd is preparing to launch an initial public offering and it has already filed its draft papers with the Securities and Exchange Board of India. Its IPO will include a fresh issue of shares worth approximately Rs. 1,000 crore. In addition, there will be an offer-for-sale (OFS) component of the same size by two promoters and a promoter group.

The company will not receive any proceeds from its offer-for-sale. The entire proceeds from the OFS are entitled to the selling shareholders after deducting all offer-related expenses and applicable taxes. However, for the fresh issue, the company has proposed several objectives:

• To make prepayments and repayment of certain outstanding dues of the company
• To meet any expenses related to general corporate purposes

Also Read: How does an IPO work?

Company Financials 

Here is the financial summary of Allied Blenders & Distillers Ltd:

Particulars	For the Financial Year Ending (Rs. Millions) Except EPS
	March 31, 2021	March 31, 2020	March 31, 2019
Total Assets	22,985.68	24,003.65	26,315.92
Total Liabilities	19,167.86	20,207.46	23,397.74
Total Expenses	61,848.16	78,855.69	86,298.88
Total Revenue	63,978.12	81,356.12	89,468.57
Profit/Loss After Tax	25.08	127.93	152.01
EBITDA	2,129.96	2,500.43	3,169.69
EPS (Basic and Diluted)	0.11 (Basic) 0.10 (Diluted)	0.54 (Basic)0.53 (Diluted)	0.65 (Basic) 0.65 (Diluted)

Strengths of Allied Blenders and Distillers

Here are some of the strengths of Allied Blenders & Distillers Ltd.

• Allied Blenders & Distillers Ltd has a positional advantage as it is one of the largest Indian-made foreign liquor (IMFL) companies with a diversified product portfolio catering to different consumer segments such as mass premium, deluxe, semi-premium and premium.
• Its distilleries are situated strategically in Rangapur and Telangana with a built-up area of 25,000 square metres. Also, it owns nine bottling facilities and has tie-ups with six third-party bottling facilities, so it can easily meet rising demand. 
• It has strong brand recognition having emerged as a multi-brand and multi-product liquor company in the country with diversified products in its portfolio.
• The board of directors are actively involved with its day-to-day operations and its independent director provides strategic guidance for the optimum utilisation of resources.  Moreover, Allied Blenders & Distillers Ltd has a highly experienced senior management team acting as a support for the general employee base.

Risks Involved

Here are some of the risk factors associated with the business activities of Allied Blenders & Distillers Ltd.

• The company is entirely dependent on the sale of its alcohol products; therefore any adverse effect in the industry business can directly impact its overall operations and profitability.
• If it fails to maintain the popularity of its popular flagship brand “Officer’s Choice”, this can have a direct effect on its financial performance.
• The spirits manufacturer receives a major portion of its orders from a few key states of the country. Any adverse situation or new stringent regulations restricting liquid consumption in these key states can affect their order books and ultimately affect revenue.

Also Read: How Can You Analyse An IPO?

Conclusion

Hopefully, by now you have got some clarity on the Allied Blenders & Distillers IPO considering the above-discussed information. For more details, check its line of business, competitive strengths, risk factors, financial performance, etc., from the DRHP.

If you are looking forward to investing in this IPO, keep an eye on our website for Allied Blenders and Distillers IPO date and other updates on the same.

Also Read: IPO investment strategy

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