Associated Alcohols ethanol division swings to Q2 loss in September

Associated Alcohols & Breweries Limited reported a Rs 2.15 crore ethanol segment loss for the quarter ended 30 September 2026, against a Rs 1.58 crore profit a year earlier, as ethanol revenue declined to Rs 84.73 crore from Rs 88.01 crore. The larger potable-alcohol division also reported lower segment profit despite higher year-on-year revenue.

What happened in Associated Alcohols’ ethanol division in Q2?

Associated Alcohols’ ethanol division moved to a Rs 2.15 crore segment loss in the quarter ended 30 September 2026 from a Rs 1.58 crore segment profit in the corresponding 2025 quarter. Segment revenue fell by Rs 3.27 crore year on year to Rs 84.73 crore, although it rose from Rs 74.38 crore in the quarter ended 30 June 2026.

The sequential comparison shows a smaller ethanol loss. The division recorded a Rs 8.37 crore loss in the June 2026 quarter, so its September-quarter loss narrowed by Rs 6.22 crore as revenue increased by Rs 10.35 crore. The filing does not disclose ethanol volumes, selling prices, raw-material costs or other reasons for the year-on-year reversal or sequential change.

For the half year ended 30 September 2026, ethanol revenue was Rs 159.12 crore, compared with Rs 160.22 crore in the prior-year half year. The division posted a Rs 10.52 crore loss for the six months, reversing a Rs 2.65 crore profit a year earlier, which means the September-quarter improvement did not offset the June-quarter loss.

How did Associated Alcohols’ potable-alcohol division perform?

Associated Alcohols’ potable-alcohol division reported Rs 200.62 crore of September-quarter revenue, up from Rs 175.89 crore a year earlier, while its segment result declined to Rs 15.94 crore from Rs 19.25 crore. Revenue therefore increased by Rs 24.74 crore, but segment profit declined by Rs 3.31 crore over the same period.

Potable alcohol remained Associated Alcohols’ larger disclosed operating division in the September quarter, with revenue more than twice the ethanol division’s Rs 84.73 crore. Its Rs 15.94 crore segment result offset the ethanol loss before finance cost and unallocable income or expenses, but was below the Rs 34.27 crore recorded in the June 2026 quarter.

For the half year ended 30 September 2026, potable-alcohol revenue rose to Rs 419.78 crore from Rs 381.00 crore in the comparable 2025 period. Segment result nonetheless slipped to Rs 50.20 crore from Rs 51.77 crore, and the filing does not identify product mix, markets or costs behind this movement.

How did segment changes affect Associated Alcohols’ Q2 profit?

Associated Alcohols’ total segment result declined to Rs 13.79 crore in the September 2026 quarter from Rs 20.82 crore a year earlier. Revenue from operations increased to Rs 276.96 crore from Rs 256.93 crore after eliminating inter-segment revenue of Rs 8.40 crore, but lower results in both reported divisions reduced the combined segment outcome.

Finance cost rose to Rs 1.62 crore from Rs 95.93 lakh in the year-earlier quarter, while unallocable income net of unallocable expenses was negative Rs 84.46 lakh, compared with negative Rs 1.42 crore. Profit before tax consequently fell to Rs 11.33 crore from Rs 18.44 crore and standalone net profit declined to Rs 8.32 crore from Rs 14.01 crore.

The sequential comparison also shows lower company-level earnings in the September quarter. Revenue from operations fell from Rs 286.30 crore in June 2026, profit before tax fell from Rs 24.15 crore, and net profit fell from Rs 17.92 crore; other income was Rs 2.04 crore, compared with Rs 3.06 crore in June.

For the half year ended 30 September 2026, Associated Alcohols reported revenue from operations of Rs 563.26 crore, compared with Rs 527.13 crore in the previous-year half year. Profit before tax declined to Rs 35.47 crore from Rs 50.22 crore and net profit declined to Rs 26.24 crore from Rs 37.67 crore.

What assets and plans did Associated Alcohols disclose?

Associated Alcohols reported ethanol segment assets of Rs 268.91 crore at 30 September 2026, up from Rs 260.38 crore a year earlier and Rs 243.45 crore at 30 June 2026. Ethanol segment liabilities were Rs 17.84 crore, below Rs 23.99 crore a year earlier, while potable-alcohol segment assets were Rs 457.18 crore and liabilities were Rs 91.11 crore.

Total standalone assets were Rs 909.38 crore at 30 September 2026, compared with Rs 855.87 crore at 31 March 2026. Property, plant and equipment increased to Rs 404.09 crore from Rs 392.23 crore, while capital work-in-progress rose to Rs 29.45 crore from Rs 18.69 crore.

Associated Alcohols said Rs 32.74 crore received as 75% allotment money against share warrants was earmarked for loans or investment in wholly owned subsidiary Associated Alcohols and Breweries (Awadh) Limited. The stated purpose is a bottling-cum-distillery unit in Uttar Pradesh, and the funds were kept in a liquid fund earmarked for that purpose as at 30 September 2026.

During the September 2026 quarter, Associated Alcohols finalised capital allocation for its acquisition of SDF Industries Limited, which became a wholly owned subsidiary on 13 May 2026. The company recognised Rs 12.50 crore as an investment in the subsidiary for fresh equity used to obtain control, while funds used to settle legacy obligations were classified as inter-company loans at amortised cost.

What unresolved matter did Associated Alcohols disclose?

Associated Alcohols said its challenge to the Competition Commission of India’s jurisdiction remains pending before the Supreme Court of India. The matter followed a 27 October 2021 search concerning the supply and sale of Indian-made Indian liquor products and the Madhya Pradesh High Court’s dismissal of writ petitions on 17 September 2026.

The company stated that it did not anticipate a material adverse financial impact from the Competition Commission matter at this stage. It also reported no exceptional items in any disclosed reporting period, meaning the September 2026 segment and standalone profit figures do not include an exceptional-item adjustment.

Conclusion

Associated Alcohols’ September 2026 disclosure shows that higher overall revenue did not produce higher segment earnings. The ethanol division changed from a Rs 1.58 crore profit to a Rs 2.15 crore loss year on year, while the potable-alcohol division’s Rs 24.74 crore revenue increase coincided with a Rs 3.31 crore reduction in segment result.

The next disclosed operational development is the planned Uttar Pradesh bottling-cum-distillery unit, supported by Rs 32.74 crore of earmarked warrant proceeds as at 30 September 2026. Investors can also monitor whether the ethanol division sustains its improvement from the Rs 8.37 crore June-quarter loss and developments in the pending Supreme Court matter.