Mohan Meakin FY26: Business Model, Financials & Valuation Explained
· 8 min read · Written by the BuyUnlistedShares desk. Information only, not investment advice.
Mohan Meakin, the 171-year-old company behind Old Monk, barely manufactures its own rum anymore. Here's how its three-part licensing model works, why FY26 profit grew 53% on just 7% revenue growth, and how its unlisted shares stack up against listed peers.
Reviewed by the BuyUnlistedShares desk.
Mohan Meakin Limited, the 171-year-old company behind Old Monk rum, is technically listed on the Calcutta Stock Exchange — but its FY26 annual report reveals that not a single share traded on that exchange during the entire financial year. Despite this, the company quietly generated ₹2,302 crore in revenue and ₹157 crore in profit. Here's a breakdown of how the business actually works, what its FY26 numbers show, and how its unlisted shares are currently valued.
How Mohan Meakin's Business Model Works
Alcohol regulation in India is state-specific: each state sets its own excise duty, licensing rules, label approvals and distribution norms, and most states impose heavy import fees on liquor made outside the state. This makes a single national manufacturing model impractical. Instead, Mohan Meakin owns its brands and reaches each state through three distinct mechanisms.
1. In-house manufacturing
The company operates four active plants — Solan Brewery (Himachal Pradesh), Kasauli Distillery, Bhankarpur (Punjab) and Mohan Nagar (Ghaziabad) — where it pays excise duty directly and books the full sale value. A fifth plant, in Lucknow, is currently shut.
2. Buy-back from licensed bottlers
In states where owning a plant isn't practical, Mohan Meakin licenses local bottlers to manufacture its brands, then purchases the finished stock and sells it onward. Its largest such partner, Mohan Rocky Spring Water Breweries, bottles exclusively for the company in Maharashtra and supplies Maharashtra, Gujarat and defence canteens.
3. Royalty income
Where a bottling partner sells directly under its own arrangement, Mohan Meakin simply earns a royalty per case — for example, ₹20 per case under its defence-canteen arrangement with its Maharashtra partner.
Revenue mix across the three streams:
Note: Reported sale figures include excise duty, while royalty income does not, so these shares are directionally accurate but not strictly like-for-like.
The shift over one year is notable:
• In-house manufacturing: Fell from 46.0% to 30.1% of revenue.
• Buy-back and royalty combined: Rose from 52.6% to 68.5% of revenue.
• Proprietary concentrate sales: A separate ₹21 crore stream — every licensed bottler is contractually required to buy Mohan Meakin's flavouring concentrate, which keeps the recipe in-house even as bottling is outsourced.
FY26 Financial Performance
Revenue grew a modest 7%, but profit jumped 53% — a gap explained mainly by an accounting quirk and a shift in business mix.
Why the excise duty line matters
Indian accounting rules require alcohol companies to report revenue inclusive of excise duty, with excise then shown as a separate expense that nets out at the profit line. This distorts year-on-year revenue comparisons. Adjusting for the sharp drop in the excise expense line tells a very different growth story:
On a net-of-excise basis, revenue actually grew 34.3% rather than the reported 7.0%. The annual report does not explain why the excise expense fell 73% in a single year, and does not provide a segment-wise split of the excise charge. One plausible explanation is that duty on bottles manufactured at a partner's plant is paid by that partner and reaches Mohan Meakin embedded in the purchase price rather than as its own excise line — but this is inference, not a disclosure made by the company.
Other notable movements
• Margin improvement: Segment margin in the alcoholic beverages business rose from 7.3% to 9.8%.
• Working capital: Trade receivables fell from ₹112 crore to ₹82 crore even as sales grew.
• Cash build-up: Cash, deposits and investments rose from ₹229 crore to ₹398 crore, against total borrowings of just ₹4.3 crore — effectively a debt-free balance sheet.
• Non-alcoholic segment: The food and beverages arm (juices, cornflakes, wheat porridge, vinegar) contributed ₹15 crore of revenue — just 0.65% of the business — but posted a loss of ₹3.4 crore.
• Trading margin: Traded-goods revenue of ₹1,520 crore against a purchase cost of stock-in-trade of ₹1,493 crore implies a spread of roughly ₹26 crore, or about 1.7% — suggesting the trading line adds far more to revenue than it does to profit.
Valuation: What the Shares Are Worth
Since the Calcutta Stock Exchange listing sees no real trading, Mohan Meakin shares change hands in India's unlisted (grey) market through dealer platforms, with recent indicative quotes in the ₹2,300–₹2,600 range and an implied market capitalisation of roughly ₹2,000–₹2,200 crore.
Excluding the company's net cash, the operating business is valued at roughly 11 times earnings.
How this compares with listed peers
• Radico Khaitan: Has traded in a range of roughly 58x to 89x earnings during the year.
• Allied Blenders: Around 50x earnings.
• Sector average: The broader listed alcoholic beverages industry trades at a P/E of roughly 48x.
At a P/E of around 13x, Mohan Meakin trades at a fraction of its listed peers despite a 28.6% return on equity, no meaningful debt, and 53% profit growth in FY26.
Why the Valuation Gap Exists
• Illiquidity: Unlisted shares trade through dealers with wide bid-ask spreads—one platform recently quoted an 8% round-trip gap between buy and sell prices — and in a slow market there may be no counterparty at all.
• No institutional coverage: There is no analyst research, no quarterly earnings calls, and no index inclusion. Promoters hold 68.17% of the company, and price discovery happens directly between dealers.
• Complex earnings mix: Around two-thirds of revenue comes from a low-margin trading arrangement, with profit contribution also tied to royalty and concentrate sales involving related parties — Mohan Rocky Spring Water Breweries and Trade Links are both related-party counterparties, a fact that is disclosed in the report.
• Low cash payout: On ₹157 crore of FY26 profit, the board recommended a dividend of ₹2.50 per share — a total payout of about ₹2.13 crore, or roughly 1.4% of profit. The remaining ₹155 crore added to the cash pile already sitting on the balance sheet.
A formal listing on the NSE or BSE could, in principle, narrow this valuation gap by improving liquidity and attracting institutional investors — but the company has not indicated any such move is planned.
Key Takeaways
• Revenue model: Mohan Meakin increasingly earns from licensing and royalty arrangements rather than direct manufacturing, with in-house production down to about 30% of revenue.
• Headline growth understates reality: Reported revenue grew 7%, but excise-adjusted revenue grew roughly 34%, while profit rose 53%.
• Balance sheet: The company is effectively debt-free, with cash and investments of about ₹398 crore.
• Valuation: Unlisted shares trade at roughly 13x earnings (about 11x excluding net cash), well below listed peers in the 48x–89x range, largely reflecting illiquidity, limited disclosure depth, and a low dividend payout.
Frequently Asked Questions
1. Is Mohan Meakin a listed company?
Technically, yes — it is listed on the Calcutta Stock Exchange. However, its FY26 annual report states that not a single share quotation was received on that exchange during the entire financial year, meaning the stock effectively does not trade there.
2. How does Mohan Meakin generate revenue?
Through three mechanisms: manufacturing and selling its own products, buying back finished stock from licensed bottling partners and reselling it, and earning royalty income where partners sell directly under license.
3. Why did Mohan Meakin's profit grow much faster than revenue in FY26?
Reported revenue grew 7%, but a sharp drop in the excise duty expense line distorted the comparison. On a net-of-excise basis, revenue grew about 34%, closer to the 53% rise in profit. A shift toward higher-margin royalty and concentrate income also contributed.
4. What was Mohan Meakin's revenue and profit in FY26?
Revenue from operations was ₹2,302 crore and profit after tax was ₹157 crore, compared with ₹2,151 crore and ₹103 crore respectively in FY25.
5. Is Mohan Meakin a debt-free company?
Effectively, yes. As of FY26, the company held cash, deposits and investments of about ₹398 crore against total borrowings of just ₹4.3 crore.
6. How are Mohan Meakin shares traded, since they aren't actively listed?
They change hands in India's unlisted (grey) market through dealer platforms, at indicative prices rather than exchange-discovered prices. Recent quotes have been in the ₹2,300–₹2,600 range per share.
7. What is Mohan Meakin's current valuation multiple?
Based on FY26 EPS of ₹184.2 and an indicative price of around ₹2,450, the shares work out to roughly 13.3 times earnings, or about 11 times when the company's net cash is excluded.
8. Why does Mohan Meakin trade at a lower valuation than listed alcohol companies?
Key factors include illiquidity in the unlisted market, the absence of analyst or institutional coverage, a complex revenue mix involving related-party arrangements, and a very low dividend payout relative to profit.
9. Does Mohan Meakin pay dividends?
Yes, but the payout is small relative to profit. On ₹157 crore of FY26 profit, the board recommended a dividend of ₹2.50 per share, a total payout of about ₹2.13 crore — roughly 1.4% of profit.
10. What is Old Monk's connection to Mohan Meakin?
Old Monk is Mohan Meakin's flagship rum brand, first launched decades ago and often described as the world's largest-selling dark rum. The company owns the brand and its proprietary flavouring concentrate, even in states where bottling is outsourced to licensed partners.
Disclaimer:
This is written for educational and informational purposes only. Nothing here constitutes investment advice or a recommendation to buy or sell securities. All data is sourced from publicly available information. Investments in securities markets are subject to market risks — please read all offer documents carefully before investing.
