Allied Blenders and Distillers’ Credit Rating Climbs to ‘IND A-’ as Financial Profile Strengthens Post-IPO

Allied Blenders and Distillers Limited (ABDL) announced that India Ratings & Research (Ind-Ra) has upgraded the company’s credit rating for its bank loans. The rating has improved from ‘IND BBB+’ to ‘IND A-’ with a Positive Outlook.

This upgrade highlights the significant enhancement in ABDL’s financial profile, following the successful completion of its initial public offering (IPO) in July 2024. The funds raised through the IPO were utilised to repay high-cost debt and settle outstanding statutory obligations, resulting in a notable reduction in interest costs and bolstering the company’s financial flexibility.

The Positive Outlook reflects Ind-Ra’s expectations of further financial improvements, driven by a reduction in ABDL’s receivable period and a consistent enhancement in EBITDA margins. Additionally, the company’s focus on premiumisation has been a key contributor to its strong performance, alongside a reduction in gross leverage.

Ind-Ra’s upgrade signifies confidence in ABDL’s ability to maintain a steady improvement in its financial metrics. The move not only improves the company’s creditworthiness but also strengthens its position for future growth in the competitive Indian spirits industry, particularly as it continues to focus on premiumisation and operational efficiency.

Speaking on the rating upgrade, the Managing Director of Allied Blenders and Distillers

Limited, Alok Gupta, said, “We are pleased with the upgraded credit ratings from Ind-Ra. This recognition reflects the progress we have made in strengthening our financial position and improving profitability. We are confident that our continued focus on operational excellence, working capital management and responsible business practices will further enhance shareholder value.”

About Allied Blenders and Distillers Limited

Allied Blenders and Distillers Limited ranks as the third-largest spirits company in India by annual sales volume from FY14 to FY24. ABDL offers a diverse portfolio across 5 key categories: whisky, brandy, rum, vodka, and gin. Its portfolio includes renowned ‘millionaire’ brands such as Officer’s Choice Whisky, Officer’s Choice Blue Whisky, Sterling Reserve Premium Whiskies, and ICONiQ White Whisky. The company’s manufacturing network consists of 33 facilities, including 9 owned bottling units, 1 owned distillery, and 23 third-party manufacturing units.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.