Balrampur Chini Mills (BALRAMCHIN) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 began steadily, with strong sugar segment performance offsetting regulatory and operational challenges in distillery operations, including a temporary government ban and lower cane availability.

• Sugarcane crushing and sugar production declined by ~54% and ~48% year-over-year due to lower cane availability, impacting both sugar and distillery segments.

• Progress continues on the 75,000 TPA Poly Lactic Acid (PLA) project, with INR 300 crore (Rs.299.8 crore) invested from internal accruals as of June 30, 2024.

• Board approved unaudited standalone and consolidated financial results for Q1 FY25, with no material misstatements identified by statutory auditors.

• Commitment to sustainable value creation and operational efficiency, with ongoing investments to optimize operations.

Financial highlights

• Consolidated Q1 FY25 revenue rose to Rs.1,421.6 crore, up 2.3% year-over-year; standalone revenue was ₹142,159.95 lakhs.

• Q1 FY25 consolidated PBT was Rs.164.9 crore (PBT margin 11.6%), and TCI was Rs.123.2 crore (TCI margin 8.7%).

• Basic EPS for Q1 FY25 stood at Rs.10.08, up from Rs.8.24 in Q1 FY24.

• Standalone EBITDA margin for Q1 FY25 was 24.0%, with EBITDA at Rs.344.7 crore.

• Cost of materials consumed dropped 47.5% year-over-year due to lower operational days.

Outlook and guidance

• IMD forecasts a normal monsoon, expected to improve yields and cane availability in Uttar Pradesh.

• National sugar inventory projected at ~8.55 MMT by September 2024, with expected production of 32 MMT and domestic consumption of 29 MMT, supporting ethanol blending and potential exports.

• Key events to watch include ethanol policy for ESY 2024-25, revision in ethanol and sugar prices, and export policy for SS 2024-25.

• PLA project commissioning targeted for October–November 2026, with gradual CapEx over the next 2–2.5 years.

• Management refrains from providing cane crushing guidance until more data is available in the next quarter.