Stock Split: Smallcap Liquor Stock Splits Into 5:2 Ratio; HDFC Sec Give BUY For Rs 387 TP; 174% Surge Seen

Smallcap breweries and distilleries company, Som Distilleries & Breweries has split into 5:2 ratio. On the day of its ex-split, the stock rallied by nearly 18% on the BSE. There is further potential for upside in the stock as HDFC Securities recommend BUY while maintaining its target price to Rs 387 apiece, hinting at a nearly 174% rise in the coming months.

Som Distilleries & Breweries Stock Split:

This liquor stock split into the ratio of 5:2. Meaning, the company's face value of Rs 5 each was sub-divided into the face value of Rs 2 each. The record date to determine the name of shareholders entitled to a 5:2 split was fixed on May 24, 2024.

Accordingly, the new ISIN for Som Distilleries is INE480C01038 upon stock split.

This will be the second stock split carried by this liquor company after the Covid-era. Earlier, the stock split into a 1:2 ratio in October 2020. Then, the face value of Rs 10 each was reduced to Rs 5 each.

SOM Distilleries & Breweries Share Price:

On March 24, the time it ex-split and determined eligible shareholders, SOM's share price surged by nearly 18% before correcting and ending at Rs 141.30 apiece, up by 12% on BSE with a market cap of Rs 2,738.06 crore.

Adjusted to the stock split ratio, the stock's new 52-week high and low is at Rs 155.92 and Rs 84.34 apiece respectively.

YTD, the stock is up by 23%. In a year, the stock zoomed by 63%, but in 5 years, the stock skyrocketed by a whopping 456.08%.

SOM Distilleries & Breweries BUY Rating:

Even after the stock split, brokerage HDFC Securities has maintained its BUY rating on the stock. On its website, for SOM Distilleries, HDFC Securities note said, "This call still has potential to give significant positive returns."

HDFC Sec has set a target price of Rs 387 on the stock, with the potential of 174% upside ahead. It expects the call to be achieved in a timeframe manner of 3 quarters.

SOM Distilleries & Breweries Earnings:

The company's net profit reported for FY 23-24 stood at Rs.85.31 crores as against Rs.60.41 crores reported in FY 22-23 showing a growth of 41%. The EBITDA for the FY 23-24 stood at Rs.155.17 crores as against Rs. 103.43 crores for the FY 22-23, a growth of 50%.

On the top-line front, the consolidated income for the FY 23-24 stood at Rs. 1286 crores as against Rs.808 crores last year showing a growth of close to 60%.

Additionally, the company's gross debt for FY 23-24 was at Rs.177 crores as compared to Rs.242 crores in FY 22-23 showing a reduction of 65 crores or around 27%. Also, the gross debt to equity further improved to 0.35 as compared to 0.67 a year ago.

About Som Distilleries and Breweries:

SOM is an integrated AlcoBev player based out of Central India. The group is into the production of Beer, Whisky, Vodka, Rum, Gin, Ready to drink beverages & Country Liquor. The group operates a brewery, a distillery, support industries & a distribution network across the country.

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