Rs 1000 crore growth plan! Why this small-cap alcohol stock is one to watch

The stock has already demonstrated impressive returns of 184.81 per cent over the past year.

Piccadily Agro Industries Ltd. (PAIL) is embarking on a substantial expansion project valued at Rs 1000 crore to capitalize on the soaring demand for its premium alcoholic beverages, including the renowned Indri single malt and Camikara rum. 

This comprehensive expansion strategy includes enhancing capacity at its existing facility in Haryana and establishing new production sites in India and Scotland, positioning Piccadily as a formidable player in the global spirits market.

Expansion Breakdown and Funding

The company has secured Rs 312 crore to fuel its growth, with Rs 262 crore raised through a preferential allotment from prominent investors and Rs 50 crore contributed by promoters. Piccadily plans to cover the remaining investment using a mix of internal accruals and debt. 

The completion of this expansion is projected over the next 24 months, with certain components, like the initial phase at the Indri plant, expected to come online by early 2025.

Enhanced Production at Indri Distillery, Haryana

A significant part of the expansion will focus on scaling the Indri distillery in Haryana. Piccadily will boost production to a total of 250 kiloliters per day (KLPD), which includes increasing the ENA/Ethanol capacity to 220 KLPD and malt spirit production from 12 KLPD to 30 KLPD. Additionally, the company will enhance its warehousing capabilities, allowing storage for over 100,000 barrels. This expanded capacity aligns with Piccadily’s mission to meet the growing domestic and international demand for high-quality whisky and other premium spirits.

To enrich the brand’s appeal, Piccadily will introduce a state-of-the-art visitor center at the Indri site. This addition aims to attract whisky enthusiasts and tourists, providing an immersive experience that delves into the art and craftsmanship of whisky-making.

New Facility in Mahasamund, Chhattisgarh

Piccadily’s plans extend to Mahasamund, Chhattisgarh, where a greenfield distillery is underway. Set to achieve a production capacity of 210 KLPD, this facility will include ENA/Ethanol output of 180 KLPD and malt production of 30 KLPD.

Currently, 30 per cent of the project has been completed, and the facility is scheduled to be fully operational by the second quarter of FY26. This expansion further cements Piccadily’s commitment to strengthening its presence in India’s premium spirits market.

First International Venture in Portavadie, Scotland

In a bold move for an Indian alco-bev company, Piccadily is launching its first international distillery in Portavadie, Scotland, on a 58-acre site. With approvals from HMRC secured, the facility is designed to produce Scotch-style malt spirits, establishing Piccadily as a global player in the whisky industry. Scotland’s new site will also feature a visitor center, creating a unique experience for whisky lovers worldwide.

This international foray not only supports Piccadily’s ambition to become a globally recognized brand but also reinforces the rising stature of Indian producers in the high-quality, premium spirits sector.

Financial Performance and Projected Returns

Piccadily’s impressive Q2 FY25 results reflect strong growth potential, with a 64 per cent year-on-year increase in total income, reaching Rs 202 crore, and a 75 per cent rise in EBITDA. For the half-year FY25, the company recorded a revenue of Rs 411 crore, marking a 17 per cent year-on-year increase. Over FY19 to FY24, Piccadily achieved a CAGR of 14.87 per cent in revenue, with profits rising from Rs 2 crore to Rs 110 crore, including other income.

The stock has already demonstrated impressive returns of 184.81 per cent over the past year. Given Piccadily’s extensive expansion plans, the company is poised for further revenue and profit growth, potentially driving the share price even higher.

Disclaimer: The article is for informational purposes only and not investment advice.