New Delhi, June 19 -- Mount Everest Breweries Ltd (MEBL) is in advanced discussions with potential investors to raise a funding round as a precursor to a planned initial public offering (IPO), two people familiar with the development told VCCircle.

The Indore, Madhya Pradesh-based company, which is part of the Associated Kedia Group, is in talks with a couple of private equity investors, family offices, and ultra-high-net-worth individuals to raise funds in a pre-IPO round, one of the persons said. The person didn't disclose the names of the potential investors.

It is also preparing for an IPO and has appointed boutique investment bank Beeline Capital Advisors to manage the issue, both the people said, asking not to be identified.

The company is likely to file a draft red herring prospectus by July and may aim to raise Rs 500 crore through the primary issuance, including the pre-IPO investment, the people said.

MEBL produces and sells beer under its own brands-Lemount, Mount 6000, Dabang and the premium variant STOK-and also undertakes contract manufacturing for large companies like United Breweries Ltd, which drives around 20% of its revenue.

The proceeds from the IPO will help the company to expand its brewery in Uttar Pradesh, for which it is currently scouting land, according to the first person cited above. It currently has breweries in Indore and Mysuru, Karnataka, and a contractual tie-up with a brewery in Assam.

"As a family business, MEBL is debt-averse. Some debt was taken to acquire the Mysore unit (Cheer Breweries). Hence, equity is the right option at this point. This could be the last equity infusion for MEBL," the person said.

Mount Everest Breweries and Beeline Capital Advisors did not respond to queries sent by VCCircle.

Growth so far

In September last year, MEBL acquired Cheer Breweries in Mysuru for Rs 300 crore, which likely boosted its capacity by 75%, from 2.0 million hectolitres to 3.5 million hectolitres.

The company's whole-time director, Vedant Kedia, told reporters at the time that the acquisition was intended to strengthen its presence in southern Indian markets and was part of the company's plan to build four brewery hubs across the country.

Last month, the company announced its entry into Andhra Pradesh, its 14th operational market. The company had also expressed its intention to establish operations across 20 states by the end of FY27.

"With the Mysore brewery supporting efficient operations in South India, Andhra Pradesh becomes a vital pillar alongside existing markets, advancing the company's goal of building a truly pan-India beer company," Kedia was quoted as saying in the statement recently.

The company holds a 45-50% market share in its home state, Madhya Pradesh. Pan-India, it directly competes with giants such as United Breweries' Kingfisher brand and Bira91, and with foreign brands such as Carlsberg, Tuborg, Budweiser, and Corona. Some of the regional brands that it competes with include Dansberg and Himalayan Blue, while craft beer maker Simba Beer competes with its premium brand STOK.

In FY26, the company's sales crossed 1 million hectolitres, equivalent to 9.3 million cases, a 24% growth from 7.5 million cases sold the previous year. Currently, STOK generates around 15% of its revenue.

In FY25, MEBL's revenue from operations grew 29% to Rs 704.3 crore, as per VCCEdge, VCCircle's data and research platform. Net profit was Rs 34.9 crore, up 70% from Rs 20.8 crore the year before.

According to an analyst tracking the firm, MEBL was targeting Rs 800-850 crore of revenues in FY26.

The Associated Kedia Group also owns Associated Alcohol and Breweries Ltd, which makes its own Indian-made foreign liquor and collaborates with several international brands for exclusive franchising and licensing in Madhya Pradesh. The firm was listed on the BSE in 2006 and on the National Stock Exchange in 2020.

Published by HT Digital Content Services with permission from VC Circle.