Allied Blenders and Distillers (ABD), the largest Indian-owned Indian-made foreign liquor (IMFL) company, has received approval from the Securities and Exchange Board of India (SEBI) to raise Rs 2000 crore through an initial public offering (IPO). The IPO comprises a fresh issue of equity shares worth up to Rs 1000 crore and an offer-for-sale (OFS) of Rs 1000 crore by promoter and selling shareholders. The face value of each equity share is Rs 2.
ABD is one of only four spirits companies in India with a Pan-India sales and distribution footprint, and is a leading exporter of IMFL. Its product portfolio comprises 10 major brands of IMFL across whisky, brandy, rum, and vodka. According to Technopak, ABD’s brands, including Officer’s Choice Whisky, Sterling Reserve, and Officer’s Choice Blue, are ‘Millionaire Brands’ that have sold over a million 9-liter cases in one year.
The proceeds from the IPO’s fresh issuance worth Rs 708.98 crore will be utilized for prepayment or scheduled re-payment of a portion of certain outstanding borrowings and the balance for general corporate purposes. ICICI Securities Limited, Axis Capital Limited, JM Financial Limited, Kotak Mahindra Capital Company Limited, and Equirus Capital Private Limited are the book running lead managers, and Link Intime India Private Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.
ABD’s revenue from operations stood at Rs 6378.78 crore for Fiscal 2021, and profit after tax at Rs 2.51 crore. For the nine months ending December 2021, revenue from operations stood at Rs 5444.98 crore and profit after tax at Rs 3.30 crore. Its revenues from export sales were ₹ 133.55 crore and ₹ 113.24 crore for Fiscal 2021 and the nine months ending December 31, 2021, respectively.
IMFL is the largest segment of the Indian alco-beverage market both in volume and value terms, with sales by value estimated at ₹ 1.74 trillion in Fiscal 2022 and projected to reach ₹ 2.4 trillion by Fiscal 2025. In terms of sales volume, it is estimated to reach 425 cases. During the period between Fiscal 2022 and Fiscal 2025, IMFL sales value is expected to grow at a CAGR of 11.3%, and sales volume at a CAGR of 6.2%.
The Mumbai-based company started its journey in 1988 with the launch of its flagship brand, Officer’s Choice Whisky, which marked its entry into the mass-premium whisky segment. From 2016 to 2019, Officer’s Choice Whisky was among the top-selling whisky brands globally in terms of annual sales volumes. ABD has expanded and introduced products across various categories and segments and established market leadership in the alcoholic beverages market in India with a market share of 8.2% in IMFL market by sales volumes in Fiscal 2021.
Distribution of alco-beverages is highly controlled by the state government, both at the wholesale and retail level, creating a high entry barrier for new players. ABD’s sales and distribution footprint span across 25 states and union territories, and its products are retailed across 64,000 outlets as stated in the draft red herring prospectus (DRHP).
The offer is being made through the book-building process, wherein not more than 50% of the offer shall be available for allocation to qualified institutional buyers, not less than 15% of the offer shall be available for allocation to non-institution.
About Allied Blenders:
Allied Blenders and Distillers Private Limited manufactures alcoholic beverages. The Company produces whiskey, brandy, rum, blended liquors, spirits, wine, and vodka. Allied Blenders and Distillers serves customers worldwide.
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