thanks for your analysis. can you pls help me understand how 500K barrels with 10 cases per barrel, translates to 5 Lakh cases. Isn’t it 50 Lakh, OR their capacity is 50K barrels (and not 500K ).
let’s assume it is 5 lakh cases, for them to be ready rolling into market around 40-50% of this should be ready after maturing for past 5 years… no?
Also, how’s competition catching up? how’s tis pricing strategy vis-a-vis Amrut and other renowned/foreign brands. I get a sense that there is no pricing attraction of their product vis-a-vis others. I guess this one will be a prime differentiation when other factors are almost similiar…
and Happy Holi to all!
Lots of expensive brands come in 6 bottle pack . e.g grey goose , lots of imported single malts too so as to make brand affordable for trade and make replenishment easier .
Thanks for your replies. Not an expert in this field , but did some number crunching over the last couple of days. Based on data available from Investor Presentations and production volumes reported from previous years annual reports, company seems fairly valued to me.
I feel like they have good demand for their new IMFL brands but the very nature of producing single malts especially ageing, creates a bottleneck to produce it in quantities. Hence scaling up can be problem where aging is involved.
On the contrary, if they can leverage their increasing brand recognition and make more blended products where production can be easily scaled which they seem to be focusing with greater increase in ENA/Ethanol capacity, they can aim for higher realisation and increased scalability.
I have attached my calculations. Any suggestions on the same are welcomed.
