Summary
BCL Industries Limited - Q3 FY 2026 Earnings Call Summary Friday, February 13, 2026 11:00 AM
Event Participants
Executives 2 Kushal Mittal (Joint Managing Director), Varun Gupta (Chief Executive Officer)
Analysts 8 Bala Murari Krishna, Bhavesh (Individual Investor), Deepesh Sancheti, Dipanshu Pandey, Heli Shah, Majid Ahmed, Pushkar Jain, Rahil S., Saket Kapoor
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Total Revenue | ₹758 crores | Reported for Q3; management is targeting a ₹3,000 crore annual revenue milestone. |
| EBITDA | ₹68 crores | +41% YoY; expansion driven by easing raw material prices and energy flexibility. |
| EBITDA Margin | 9.00% | +270 bps YoY; improved due to the exit of the old edible oil unit and operational efficiencies. |
| PAT | ₹35 crores | +69% YoY; reflects strong operational performance in the distillery segment. |
| Distillery EBITDA | ₹60 crores | +42% YoY; remains the primary driver of profitability. |
| ENA Sales Volume | 15,330 KL | +60% YoY; reflects demand momentum and strategic shift due to lower ethanol allocations. |
| Ethanol Sales Volume | 47,420 KL | Reported for Q3; volumes constrained by OMC allocation levels. |
| Consolidated Debt | ₹494 crores | Includes working capital and long-term debt; anticipated to trend lower. |
| Cost of Debt | 7.5% - 8.0% | Weighted average excluding interest subvention; subvented debt cost at ~4.5%. |
Geographic & Segment Commentary
- Distillery (Bathinda & Kharagpur): Capacity utilization reached nearly 100% in Q3. The company is transitioning production to Extra Neutral Alcohol (ENA) to mitigate lower Oil Marketing Company (OMC) ethanol allocations. Strategic focus remains on grain-based flexibility (maize and rice).
- Retail & Liquor (PML): Sales reached 488,000 boxes in Q3 FY26. The segment launched “Punjab Special Whiskey” in glass bottles to elevate brand positioning. This serves as a stepping stone for a planned entry into the Indian Made Foreign Liquor (IMFL) segment.
- Edible Oil & Refining: Revenue stood at ₹153 crores with a 5.23% EBITDA margin. The company has fully exited the packaged oil business to focus on bulk crude oil importing and refining. Oil trading is now reported as a separate segment for transparency.
Company-Specific & Strategic Commentary
- Capacity Expansion: Total distillery capacity is on track to reach 900 KLPD by the end of FY26. This includes the 150 KLPD expansion at Bathinda and a capacity upgrade at Svaksha (Kharagpur) from 300 to 350 KLPD.
- Consolidation: BCL will acquire the remaining 25% stake in Svaksha Distillery for ₹55 crores by June 30, 2026. This will make it a wholly-owned subsidiary, streamlining operations and unlocking synergies.
- Sustainability: On track to meet 100% of steam and power requirements via paddy straw-based biomass boilers. A new 55-tonne per hour boiler is being commissioned at the Bathinda plant to drive further cost savings.
- Forward Integration: A maize oil extraction unit at Svaksha is scheduled for commissioning in Q4 FY26. Management is also evaluating future investments in Sustainable Aviation Fuel (SAF) and malt plants.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Capacity | 900 KLPD by end of FY26 | Includes Bathinda 150 KLPD expansion and Svaksha 50 KLPD upgrade. |
| Capex Strategy | “Paused” on new Ethanol | Management is holding the 250 KLPD Goyal Distillery expansion pending clearer government policy on blending beyond E20. |
| Utilization | Close to 100% | Targeted for Q4 FY26 despite allocation uncertainties by maximizing ENA sales. |
| Product Launch | IMFL Entry (TBD) | Phased approach starting with premiumizing current country liquor (IMIL) offerings. |
Risks & Constraints
| Risk | Context |
|---|---|
| Regulatory/Policy | Volatility in OMC ethanol allocations and potential revisions to maize-based ethanol pricing (currently ₹72/liter) pose risks to volume visibility. |
| Pricing Pressure | Increased industry-wide supply of ENA (due to lower ethanol demand) has compressed ENA prices to ₹59–₹60 per liter. |
| Operational Viability | Biodiesel operations are currently unviable due to low OMC tender prices (₹80-₹90 vs historical ₹124); the plant remains idle. |
Q&A Highlights
Distillery Dynamics & Pricing
- Question: Why haven’t lower maize prices (₹20-₹21/kg) translated into higher margins? (Bala Murari Krishna)
- Answer: ENA has become extremely competitive with lower realizations (₹59-₹60) compared to ethanol. The shift to ENA to maintain utilization has capped margin expansion (Kushal Mittal).
Stake Acquisition and Asset Sale
- Question: How will the Svaksha stake acquisition be funded? (Bhavesh)
- Answer: Primarily through the sale of a 16-acre industrial land parcel in Bathinda, valued at approximately ₹45 crores (Kushal Mittal).
Capacity Flexibility
- Question: How much capacity is restricted to ethanol production only? (Deepesh Sancheti)
- Answer: 500 KLPD (350 Bathinda, 150 Kharagpur) is dedicated to ethanol due to interest subvention requirements. The remainder is flexible for ENA (Kushal Mittal).
Strategic Pivot
- Question: What is the plan for the 250 KLPD Goyal Distillery expansion? (Deepesh Sancheti)
- Answer: Expansion is on hold. The company is preserving cash for potential high-value pivots like Sustainable Aviation Fuel (SAF) or a malt plant (Kushal Mittal).
Key Takeaway
BCL Industries delivered a strong Q3 FY26, characterized by a 41% YoY increase in EBITDA to ₹68 crores and a 69% surge in PAT to ₹35 crores. The company successfully navigated lower ethanol allocations by pivoting to ENA, achieving near 100% capacity utilization. Strategic milestones include the progression toward a 900 KLPD total capacity and the acquisition of the remaining 25% stake in the Svaksha subsidiary. Management is transitioning the business model by exiting low-margin packaged edible oils and premiumizing its liquor portfolio via the “Punjab Special Whiskey” launch. While the company faces short-term headwinds from ENA price compression and biodiesel unviability, it is focused on long-term opportunities in Sustainable Aviation Fuel (SAF) and vertical integration through maize oil extraction. BCL remains well-positioned for the E20 blending era while maintaining the financial discipline to pause further ethanol expansion until policy clarity emerges.
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