Bira 91's financial woes deepen; auditor flags eroded net worth amid Rs 1,904 cr loss

The auditor of B9 Beverages, the privately held maker of Bira 91 beer, has reportedly flagged serious concerns over the company’s financial health and asset valuation.

Read more: Over 250 Bira 91 employees demand founder Ankur Jain’s ouster amid financial turmoil and unpaid dues

In its audit report for FY24, Walker Chandiok & Co, a network firm of Grant Thornton International, said B9 Beverages “is exposed to market risk, credit risk, and liquidity risk which may impact the fair value of its financial instruments." The auditor also noted that the company’s net worth has been fully eroded, as per an ET report.

The Delhi-based brewer has yet to file its FY25 financials. For FY24, B9 Beverages reported a negative cash flow of Rs 84 crore and accumulated losses of Rs 1,904 crore, with liabilities exceeding assets by Rs 619.6 crore as of March 31, 2024.

“These events and conditions indicate the existence of material uncertainty that may cast significant doubt about the group’s ability to continue as a going concern, with current liabilities far exceeding current assets," the audit report said, according to ET.

Read more: From London pubs to empty breweries: The downward spiral of Bira 91

Founder Ankur Jain, responding to ET’s queries, said, “It is not unusual for businesses at the growth stage to have current liabilities exceed current assets at this stage of the business."

Separately, it was earlier reported that the Ministry of Corporate Affairs (MCA) has advised B9 Beverages “to be careful in the future and ensure timely compliance" after the company sought an extension to hold its AGM for FY25, citing “difficulties." The Registrar of Companies granted a three-month extension on September 4 to submit the FY25 financials.

Jain told ET that the MCA’s note was “standard boilerplate language" used in such procedural permissions and consistent with similar cases.

In its audit report, Walker Chandiok & Co said the management remains confident of meeting obligations “based on future cash flow projections and infusion of funds subsequent to year-end, along with expected capital infusion from prospective investors."

Recently, more than 250 employees of B9 Beverages have petitioned the company’s board and top investors - including Japanese beverage major Kirin Holdings and Peak XV Partners - seeking the removal of founder and CEO Ankur Jain from the company’s management.

The petition, addressed to the board, key investors, and the company’s largest lender, Anicut Capital, alleged “corporate governance failures, lack of transparency, delays in employee dues and salaries,” and pointed to pending creditor cases and unpaid vendor bills that reflect the company’s deteriorating financial condition.

Read more: From Delhi Techie to Beer King: Who is Bira 91 founder Ankur Jain?

Earlier in July this year, B9 Beverages restructured its leadership team and appointed Vikram Qanungo as its chief financial officer. Qanungo succeeded Meghna Agrawal who was the CFO from 2019-2024. It had roped in Manoj Mishra as the vice president - manufacturing. Additionally, Nayanabhiram Deekonda was elevated to senior vice president - sales.