G M Brew

GM Breweries announced its Q2FY16 and the market was pretty kicked about it and rightly so too! The company posted a whopping 350% (YoY) jump in net profit at Rs.9 crore and this was driven purely by robust sales – up 25% at Rs.94 crore. Costs rose 8% at Rs.77 crore and this was led maninly by a 4% rise in packaging cost, which comprises of 36% of entire cost. EBITDA came in at Rs.18 crore, up three times and margins spurted up from 8% to 19.15%. Its HIFY16 net profit at Rs.25 crore has already surpassed that of entire FY15 of Rs.17 crore. The lower base effect is also at play but overall, great performance.

The company is engaged in the activities of manufacturing and marketing of Alcoholic Beverages; such as Country Liquor (CL) and Indian made Foreign Liquor (IMFL). It is the largest manufacturer of country liquor in the state of Maharashtra with a sizeable market share. Its brands are GM Santra, GM Limbu Punch, GM Dilbahar Sounf and GM Doctor. The company is essentially is a “country” liquor maker and thus has a huge customer base though margins are lower than the other big branded liquor companies, which is made up through higher volumes. Promoters stake at end of Q2FY16 stands at 74.43%.