Growth stalling: 606% revenue vs margin compression, lower CBG capex

Delivered ₹811.1 Cr YoY 606.2%

Delivered ₹35.0 Cr vs prior-year loss ₹38 Cr

OPM 12.5%, NPM 4.3% — EBITDA margin higher but operating margin lower than stated

Down from prior guidance of 44 Cr liters in hand

Prior guidance ₹760 Cr for 132 TPD by Q4. Current plan achieves ~72 TPD

From ₹760 Cr for 132 TPD by Q4 to ₹300 Cr for 4-5 plants (~72 TPD). Capex phasing slowed; debt raised only ₹70-80 Cr vs ₹532 Cr implied.

From 44 Cr liters in hand (prior call) to 40-42 Cr expected for new supply year. Margin: narrowed allocation, not fully offset by capacity.

Road map still pending from government; front-end engineering ongoing. Viability gap fund ₹150 Cr received, but no new capex or FY29 update.

Company converting 3 plants to grain-base feedstock (press mud, maize, rice) to diversify away from sugarcane juice dependency and lock cheaper pricing.

Management hopes for 'correction' in raw material prices by Q3-Q4 but offers no numeric margin guidance. CBG EBITDA targeted 60-70% (vs ethanol 12-14%).

Expected allocation 40-42 Cr liters for new supply year (Nov 2026-Oct 2027). Current quarter (Oct-Nov) has 8.5 Cr pending orders + further allocation expected. Will disclose when bids awarded.

CBG capex: 4-5 plants @ ₹65 Cr per plant = ~₹300 Cr total. Debt ₹70-80 Cr expected, capital subsidy ₹2 Cr per TPD. No new ethanol capex planned.

Converting 3 plants to grain-base (press mud, maize, rice) for flexibility. Sourcing from Bihar and Madhya Pradesh. Storing inventory at lowest prices; will accumulate across year.

Already have 8.5 Cr liters of orders with required RM tied up. Q2 effective margin upwards of 12% from here, should increase Q3 onwards as raw material settles.

Maize-based ₹68/liter, grain-based ₹64/liter, FCI rice ₹60/liter. RM cost 62-66% of sales, could go to 70%. EBITDA margin 50-55% on ethanol business.

20 TPD commissioned. Expected ₹10-15 Cr revenue per plant, scaling to ₹20 Cr. EBITDA margin 50-55% realistic, 60-70% upside if gas prices hold.

Allowed up to 75%, currently ~71%. Margin of 3.5-4%. Pledges for future purchases; no immediate dilution planned.

Capital incentive doubled ₹1 Cr to ₹2 Cr per TPD. Cap of ₹30 Cr per plant. Gas price assured 10 years. 90% of output must be bought by OMCs, at least 50% to suppliers. Highly supportive.

March 26: ₹528 Cr inventory. Sep 26: ₹206 Cr. Will be out of books with new season; 8.5 Cr liters pending supply + fresh allocation coming.

Present gross margin close to 30%. Once ESY tenders finalized, clarity on realization will improve.

Already getting substantial income from DDGS at ₹26-27 per kg. No expansion needed; already generating byproduct income.

1,300 KLPD is dual-feed. Converting 400 KLPD plant to C-molasses focus. Q2 was 62%, H1 avg 64-65%. Allocation increase will drive utilization up.

ENA prices up to ₹62-63 per liter. Cost to produce ENA ₹5/liter cheaper than ethanol. 2x 400 KLPD units running on ENA year-round using C-heavy molasses.

Expected ~₹170 Cr from slump sale. INR 130 Cr debt repay (term loan), INR 46 Cr additional + interest/employee expense savings ~₹22 Cr over time.

Not the only CBG plant. Area has abundant sugar units; TEV study shows 6-7% raw material availability from press mud.

Industrial alcohol demand 250-300 Cr liters/year, at least 40-50% catered by Indian manufacturers. ENA prices improving (₹62-63/liter, up from ₹47-48). Expect continued strength.

Tenders starting Nov 2026. Company eligible for full allocation per new rules (2,000 KLPD installed capacity).

First plant operational, 3-4 commissioned by Q3. Demand from GOBARdhan 2.0 guaranteed takeaway clause.

Q2 compression due to maize +25-30%. Management hopes for normalization but no numeric target stated.

10-year government gas price protection + 90% offtake clause. Historical track record shows 60%+ achievable.

Debt ₹70-80 Cr expected; capital subsidy ₹2 Cr/TPD from GOBARdhan 2.0. Phased over FY27-28.

Capacity target 75-80% utilization. Conversion to grain-base will optimize existing plants.

Maize prices up 25-30% in Q2 alone. E1 Nino is reducing crop yields; company has minimal hedging and relies on spot purchases and seasonal inventory buildup at 'cheapest prices'.

Government allocation for ethanol reduced to 40-42 Cr liters for new supply year (down from 44 Cr in prior hand). Allocation depends on government tenders; if bids fall short or OMC demand softens, volume could be capped further.

CBG capex guidance scaled back from ₹760 Cr (132 TPD) to ₹300 Cr (72 TPD visible). Only 20 TPD commissioned so far; 3-4 plants by Q3 end is aggressive given joint venture complexity with Sumitomo and GAIL.

Q2 OPM fell to 12.5% from stronger H1 baseline. Shift to lower-margin grain-based ethanol (₹64/liter vs maize ₹68/liter) plus raw material cost inflation limiting realization growth. Blended realization pressure evident.

Sustainable Aviation Fuel road map still pending from government. Front-end engineering ongoing but no capex or production timeline update. Prior guidance FY29 revenue target remains unverified.