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companylogoAssociated Alcohols & Breweries Ltd

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BSE Code : 507526 | NSE Symbol : ASALCBR | ISIN : INE073G01016 | Industry : Breweries & Distilleries |


Directors Reports

Dear Members,

Your Directors have pleasure in presenting their 36th Annual Report together with the Financial Statements and Auditor's Report of the Company for the financial year ended on 31st March 2025.

1. FINANCIAL RESULTS

A summary of the company's financial result for the financial year 2024-25 is as under:

(Rs in Lakhs)

PARTICULARS

FY 2024-25 FY 2023-2024
Revenue from Operations 1,09,657.90 76,451.64
EBITDA (Net of Other Income) 12,809.10 7,672.63
Less: Interest 569.54 367.24
Profit before Depreciation 12,239.56 7,305.39
Less: Depreciation 1,744.06 1,440.39
Add: Other Income 469.60 963.79
Profit before Tax 10,965.10 6,828.79
Provision of Tax 2,818.88 1,766.49
Net Profit 8,146.22 5,062.30

2. FINANCIAL PERFORMANCE

Your company has demonstrated robust financial growth, with Net Revenue from Operations increasing by 43% year-over-year to Rs 109657.90 Lakh. The company's EBITDA rose 67% year-over-year to Rs 12809.10 Lakh reflecting enhanced operational efficiency. Profit After Tax (PAT) reached Rs 8146.22, Lakh marking a 61% year-over-year increase and expanding the PAT. Additionally, the Diluted Earnings Per Share (EPS) stood at Rs 43.05, reflecting a growth of 54% year-over-year, underscoring the company's strong financial performance and value creation for shareholders.

3. STATE OF AFFAIRS OF THE COMPANY

Associated Alcohols & Breweries Ltd. (AABL) plays a pivotal role in the Indian alcoholic beverage industry, serving as a primary supplier of high-quality Extra Neutral Alcohol (ENA) to leading Indian Made Foreign Liquor (IMFL) manufacturers and bottlers. The company has strategically directed a significant portion of its ENA production towards value-added products, resulting in a slight decrease in overall ENA volumes. AABL's versatility is evident in its ability to produce ENA from a variety of feedstocks, ensuring a steady supply to meet diverse market demands. In a significant expansion of its operations, AABL commenced commercial production at its state-of- the-art 130 KLPD ethanol plant in Barwaha, Madhya Pradesh, with an investment of approximately Rs 150 crore. This grain-based facility is equipped with advanced technology and a versatile boiler capable of utilizing various fuels, including coal, husk, and briquettes, underscoring the company's commitment to eco-friendly practices and operational efficiency.

Furthermore, AABL is capitalizing on favorable government initiatives, such as the Ethanol Blending with Petrol (EBP) program, to diversify its revenue streams and contribute to sustainable energy solutions.

4. SHARE CAPITAL

The paid-up equity share capital of the company as at March 31, 2025, stood at Rs 1807.92 lakhs divided into 1,80,79,200 equity shares of Rs 10/- each.

Preferential Allotment: During the year, the company proposed and thus allotted;

a) 9,00,000 warrants at price of Rs 485/- each convertible into 9,00,000 equity shares of Rs 10/- each at a premium of Rs 475/- per share in one or more tranches within a period of 18 months from the date of allotment i.e. 28th March 2024 on preferential basis to two promoters of the company of the company as per provisions of the SEBI (ICDR) Regulations, 2018 and the SEBI (LODR), Regulations, 2015.

b) 11,00,000 warrants at price of Rs 679/- each convertible into 11,00,000 equity shares of Rs 10/- each at a premium of Rs 669/- per share in one or more tranches within a period of 18 months from the date of allotment i.e. 7th October 2024 on preferential basis to two promoters of the company and two other persons/non-promoter of the company as per provisions of the SEBI (ICDR) Regulations, 2018 and the SEBI (LODR), Regulations, 2015.

These warrants are outstanding on the date of report.

5. DIVIDEND & RESERVES

Your directors have recommended dividend for approval of the members at the ensuing 36th Annual General Meeting a dividend of 20% i.e. Rs 2.00/- each (previous year 20% i.e. Rs 2.00/- each) on 1,80,79,200 Equity Shares of face value of Rs 10.00/- each the aggregate amount being Rs 361.58 lakhs, payable to shareholders whose name appear in the Register of Members as on the Book Closure Date/Record Date. The company has not transferred any amount in the general reserve.

6. FINANCE & ACCOUNTS

As mandated by the Ministry of Corporate Affairs, the financial statements for the financial year ended on 31st March 2025 has been prepared in accordance with the Indian Accounting Standards (IND AS) notified under Section 133 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 as amended from time to time. The estimates and judgments relating to the Financial Statements are made on a prudent basis, so as to reflect in a true and fair manner, the form and substance of transactions reasonably present the Company's state of affairs, profits and cash flows for the financial year ended 31st March, 2025. The Notes No. 3 & 4 to the Financial Statements adequately cover the accounting policy and form an integral part of this report.

7. ETHANOL DIVISION

A significant step towards diversifying our product portfolio, and a testament to our vision and commitment to innovation, the Ethanol Project / Plant has been completed, and commercial production has commenced at its state-of-the-art 130 KLPD ethanol plant in Barwaha, Madhya Pradesh, with an investment of approximately Rs 150 crore. This grain- based facility is equipped with advanced technology and a versatile boiler capable of utilizing various fuels, including coal, husk, and briquettes, underscoring the company's commitment to eco-friendly practices and operational efficiency.

8. CCI INVESTIGATION

As reported from time to time and that during last year the company had received an order from the CCl based on the investigation report of the DG submitted to the CCl alleging cartelisation in the supply of certain products.

The company has challenged the jurisdiction of the CCl on the aforesaid order before the Hon'ble Delhi High Court, the Hon'ble Court directed the Company to raise all its contentions before the CCI during the process.

Accordingly, the company has sought necessary clarification from CCl and is in the process of submitting its responses as further sought in the order. The CCI in its last order dated 20.03.2024 has further order the DG to investigate the report, till date CCl has not raised any demand in this matter and the Company doesn't perceive any unfavourable impact.

9. DIRECTORS' RESPONSIBILITY STATEMENT

As required under section 134(5) of the Companies Act, 2013 the Directors confirm that:

a) that in the preparation of the annual accounts, for the financial year ended the 31st March, 2025, the applicable accounting standards read with the requirements set out under schedule III of the Act, have been followed and there is no material departure from the same the applicable accounting standards have been followed.

b) that appropriate accounting policies have been selected and applied consistently and that judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as on 31st March, 2025 and of its profit for the year ended on that date.

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records under the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) that the annual financial statements have been prepared on a going concern basis.

e) that the directors had laid down internal financial control to be followed by the company and that such internal financial control is adequate and were operating effectively.

f) that the directors had devised proper system to ensure compliance with the provision of all applicable laws and that such system were adequate and operating effectively.

10. COMPOSITION OF BOARD

The Board provides leadership, strategic guidance, objective and independent view to the Company's management while discharging its fiduciary responsibilities thereby ensuring that the management adheres to high standards of ethics, transparency and disclosure. The Board has constituted Audit Committee, Stakeholders Relationship Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Risk Management Committee and Operational Committee. The following is the composition of the Board:

Name of Director

DIN

Designation / Category

Mr. Prasann Kumar Kedia 00738754 Managing Director
Mr. Anshuman Kedia 07702629 Whole Time Director & CEO
Mr. Tushar Bhandari 03583114 Whole Time Director & CFO
Dr. Swaraj Kumar Puri 10522141 Independent Director
Mr. Debashis Das 08755043 Independent Director
Ms. Apurva Pradeep Joshi 06608172 Independent Director

Declaration of Independence

The Independent Directors of the Company have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1) (b) of the SEBI (LODR) Regulations, 2015. In the opinion of the Board, the Independent Directors are the person of integrity and possesses relevant expertise and experience and also fulfil the conditions of independence specified in Section 149(6) of the Act and Regulation 16(1) (b) of the SEBI (LODR) Regulations, 2015. The Independent Directors have also confirmed that they have complied with the Company's Code of Business Conduct & Ethics.

Director liable to retire by rotation seeking reappointment

In accordance with the provisions of section 152 of the Companies Act, 2013 and Company's Articles of Association, Mr. Tushar Bhandari (DIN: 03583114), Director retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for reappointment. The Board has recommended his appointment for the consideration of the members at the forthcoming Annual General Meeting. Brief profile of Mr. Tushar Bhandari has been given in the Notice convening this Annual General Meeting.

Nomination and Remuneration Policy

The policy on Director's appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and also remuneration for Key Managerial Personnel and other employees can be viewed at the Company's website at www.associatedalcohols.com.

Appointment, Completion of Term and Resignation of Director

There were no appointment and resignation of directors done during the period under review. However, first term of Ms. Apurva Pradeep Joshi (DIN: 06608172) is getting completed on 11th September 2025. The Board of Director has proposed her reappointment for second term in the Board Meeting held on 26th April 2025 subject to approval of the member in the ensuing 36th Annual General Meeting of the company.

11. KEY MANAGERIAL PERSONNEL

During the period under review following are the Key Managerial Personnel of the company as on 31st March 2025:

1. Mr. Prasann Kumar Kedia - Managing Director

2. Mr. Anshuman Kedia - Whole Time Director & CEO

3. Mr. Tushar Bhandari - Whole Time Director & CFO

4. Mr. Abhinav Mathur - Company Secretary Notes:

1. Mr. Anshuman Kedia has been redesignated as Whole Time Director & CEO w.e.f. 02nd May, 2024).

2. Mr. Ankit Agrawal had been elevated to the post of Group CFO and resigned from the post of CFO of the Company w.e.f. 31st August, 2024.

3. Mr. Tushar Bhandari has been appointed as Chief Financial Officer of the Company w.e.f. 24th October, 2024.

4. Mr. Sumit Jaitley, Company Secretary of the Company resigned w.e.f. 31st October, 2024 and

5. Mr. Abhinav Mathur has been appointed as the Company Secretary of the Company w.e.f. 24th January, 2025.

12. MEETINGS

During the year Six (6) Board, Five (5) Audit Committee, Two (2) Stakeholders Relationship committee, Three (3) Nomination and Remuneration Committee, One (1) CSR Committee and Two (2) Risk Management Committee Meetings were convened and held. The details of the same is disclosed in Corporate Governance report.

13. PERFORMANCE EVALUATION OF BOARD, COMMITTEES & DIRECTORS

Pursuant to the provisions of the Companies Act, 2013 and the Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors adopted a formal mechanism for evaluating its performance and as well as that of its committees and individual Directors.

The Directors were satisfied with the evaluation results, which reflected overall engagement of the Board and its Committees with the Company.

14. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

As part of its initiatives under "Corporate Social Responsibility” (CSR), the company has constituted Corporate Social Responsibility Committee. The CSR Committee has framed the CSR policy of the company. The Committee has made expenditure which form part of this report.

Annual Report on CSR activities is annexed herewith as ‘'Annexure A”.

15. MANAGEMENT DISCUSSION AND ANALYSIS

As stipulated in Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report form part of this Annual Report.

16. CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governance as prescribed in the Regulation 27 of the SEBI (LODR) Regulations, 2015 as applicable to the Company. A separate report on Corporate Governance and Auditors Certificate thereon are included as part of the Annual Report

17. RELATED PARTY TRANSACTIONS

All related party transactions that were entered during the financial year were on an arm's length basis and were in the ordinary course of business and that the provision of Section 188 of the Companies Act, 2013 and the Rules made thereunder are not attracted. Thus, disclosure in form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required. Further there is no material related party transaction during the year under review with the Promoter, Directors or Key Managerial Personnel.

All related party transactions are placed before the Audit Committee as also the Board of Directors for approval. Omnibus approval was obtained on a yearly basis for transactions which are repetitive in nature. The details of the related party transaction are disclosed in Note no. 43 of the Financial Statements.

18. RISK MANAGEMENT

The Company in accordance with the provisions of the Companies Act, 2013 has adopted a Risk Management Policy. The Company has constituted a Risk Management Committee under the Companies Act, 2013 and Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This ensures identification and mitigation therein of elements of risk, if any, which in the opinion of the Board may threaten the existence of the company.

19. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENT

The Company's system of financial and compliance controls with reference to the financial statements is embedded in the business process by which the Company pursues its objectives.

Management is responsible for establishing and maintaining adequate disclosure controls and procedures and adequate internal controls over financial reporting with respect to financial statements besides its effectiveness in the context of applicable regulations.

The Internal Auditor, the Audit Committee as well as the Board of Directors conduct from time to time an evaluation of the adequacy and effectiveness of the system of internal controls for financial reporting with respect to financial statements.

20. AUDITORS

M/s Singhi & Co., Chartered Accountants, Kolkata (FRN: 302049E) are the Statutory Auditors of the Company to hold office till the conclusion of 38th Annual General Meeting of the Company to be held in the year 2027.

The Report given by the Auditors on the financial statement of the company forms part of this Report and are self-explanatory. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report.

21. SECRETARIAL AUDIT

The Board of Directors under section 204(1) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Management Personnel) Rules, 2014 and Regulation 24A of SEBI Listing Regulations has appointed M/s K. Arun & Co. (Practicing Company Secretaries), Kolkata to conduct secretarial audit of the company for a period of five years from FY 2025-26 to FY 2029-30 subject to the approval of shareholders of the Company in the ensuing Annual General Meeting.

The Secretarial Audit report for the Financial Year ended 31st March, 2025 is annexed herewith as “Annexure B” and forms part of this report. The report is self-explanatory and do not call for any comments except the secretarial auditor has reported about the fines which was paid during the year under review to Stock Exchanges for non-compliance of regulation 19 (1) & (2), 20 (2) & 20A and 17(1A) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 which was occurred due to different views of interpretation of relevant regulations by the stock exchanges and the company.

22. COST AUDIT

The Board on the recommendation of the Audit Committee has appointed M/s M.P. Turakhia & Associates (Practicing Cost Accountant), Indore as the Cost Auditor of the Company for the financial year 2025-26. In accordance with the provisions of the Act, read with the Companies (Cost Records and Audit) Rules, 2014, the Company has maintained cost records.

23. ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)

(a) of the Companies Act, 2013 the Annual Return as on 31st March, 2025 is available on the Company's website on https://associatedalcohols.com/investor- contact/

24.SECRETARIAL STANDARD

During the year under review, the Company has complied with the provisions of the applicable Secretarial Standards issued by the Institute of Company Secretaries of India as mandated under Section 118(10) of the Companies Act, 2013.

25. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO

Information required under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Account) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings/ outgo is appended hereto as “Annexure C” and forms part of this report.

26. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013

The particulars of Loans, Guarantees and Investment in pursuant to Section 186 of the Companies Act, 2013 are given in Note no. 50 to the financial statements.

27. SUBSIDIARY COMPANY:

Statement containing the salient features of Financial Statement of subsidiary i.e. Associated Alcohols & Breweries (Awadh) Limited pursuant to provisions of section 129(3) in form AOC-1 annexed herewith as “Annexure D” and forms part of this report.

The Company has neither associate companies nor joint ventures during the period under review.

28. DEPOSITS

During the year your company has not accepted any deposit from public under Section 73 of the Companies Act, 2013 and Companies (Acceptance of Deposit) Rules, 2014.

29. GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

• Issue of equity shares with differential rights as to dividend, voting or otherwise.

• Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

• No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

• No instances of fraud reported by auditor under Section 143(12) of the Companies Act, 2013.

• There are no proceedings initiated/ pending against the Company under the Insolvency and Bankruptcy Code, 2016.

• During the financial year under review, there were no instances of one-time settlement with any bank or financial institution.

• The company did not undergo any change in the nature of its business during the financial year.

• Details of deposits covered under Chapter V of the Act.

30. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURE

The relation between the employees and the management has been cordial throughout the year under review and the Directors place on record their appreciation for the efficient services rendered by the employees at all levels.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed hereto as “Annexure E” and forms part of this report.

31. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The company has a Vigil Mechanism/Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The details of the policy is explained in the Corporate Governance Report and also posted on the website of the company.

32.INTERNAL COMPLAINTS COMMITTEE

The company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and there were no cases filed or reported pursuant to the said act during the year under review.

33.TRANSFER OF SHARES TO THE INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to applicable provisions of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules”), all unpaid or unclaimed dividends are required to be transferred by the Company to the Investor Education and Protection Fund ("IEPF” or "Fund”) established by the Central Government, after completion of seven years from the date the dividend is transferred to unpaid/unclaimed account. Further, according to the Rules, the shares in respect of which dividend has not been paid or claimed by the Members for seven consecutive years or more shall also be transferred to the demat account of the IEPF Authority.

The Company had advertised a notice in the newspapers seeking action from the Members who have not claimed their dividends for seven consecutive years or more. Thereafter, the Company has transferred such unpaid or unclaimed dividends and corresponding shares to IEPF, in relation to FY 2014-15, FY 2015-16 & 2016-17.

Members/claimants whose shares or unclaimed dividend, have been transferred to the IEPF demat Account or the Fund, as the case may be, may claim the shares or apply for a refund by approaching the company or the Company's RTA for issue of Entitlement Letter along with all the required documents, after making an application to the IEPF Authority in Form IEPF - 5 (available on http://www. iepf.gov.in) along with requisite fee as decided by the IEPF Authority from time to time.

The Company will be transferring such unpaid or unclaimed dividends and corresponding shares to IEPF, in relation to FY 2017-18 within statutory timelines. Members are requested to ensure that they claim the dividends and shares referred above, before they are transferred to the said Fund.

The unpaid or unclaimed dividend amount of Rs 8,07,260/- related to financial year 2016-17 which was required to be transfer to IEPF has been transferred on 28th October 2024.

34. MATERIAL CHANGES OCCURRED AFTER END OF FINANCIAL YEAR

No material changes and commitments which could affect your Company's financial position have occurred between the end of the financial year of your Company and date of this report.

35. WEB-LINK FOR DIVIDEND DISTRIBUTION POLICY

The Board of Directors of the Company has approved and adopted the Dividend Distribution Policy in line with Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This Report is also uploaded on the website of the Company and is available on the Company's website on https://www.associatedalcohols.com/policies/.

36. PROSPECTS/OUTLOOK

The details about the prospects / outlook of your company are provided under the Management Discussion and Analysis forming part of this report.

37. ACKNOWLEDGEMENT

Your Directors express their sincere appreciation for the co-operation and support received from shareholders, bankers, financial institutions, regulatory bodies, customers, suppliers, employees and other business constituents during the year under review.

FOR AND ON BEHALF OF THE BOARD

Prasann Kumar Kedia

Anshuman Kedia

Managing Director Whole Time Director & CEO
DIN: 00738754 DIN: 07702629
Place: Indore
Date: 26.04.2025