Asgard Alcobev's subsidiary CMJ Breweries rating reaffirmed CARE B-; Stable

Asgard Alcobev Ltd. announced that CARE Ratings Ltd. has reaffirmed the "CARE B-; Stable" credit rating for its subsidiary, CMJ Breweries Private Limited's long-term bank facilities. The facilities amount to ₹56.50 crore, a reduction from ₹98.80 crore. The rating is constrained by past debt restructuring, weak profitability, a leveraged capital structure, and stretched liquidity. Other factors include losses from a hived-off distillery unit, ongoing debt-funded capital expenditure, regulatory changes impacting the spirit industry, and raw material price volatility. However, the rating benefits from CMJ Breweries' operational track record, association with leading brands, improved capacity utilization post-modernization, and high entry barriers in the liquor industry. CARE also acknowledged the structural change following Asgard Alcobev's substantial stake acquisition. The stable outlook anticipates improved financial performance from steady capacity utilization. The company had previously settled a One Time Settlement (OTS) of ₹113.67 crore with various banks by March 2023 and is managing another OTS with MIDCL, with ₹29.00 crore repaid and ₹9.00 crore due by February 2027.