BALRAMPUR CHINI MILLS LTD. Q3 FY25 Results

During the quarter, the sugar segment delivered strong performance, driven by higher profitability from improved margins. In contrast, the Distillery segment faced challenges due to lower alcohol recovery in the Juice route as a result of lower Pol% in cane, which is now picking up. Cane crushing during the quarter was 10.4% higher than during the same period last year; however, sugar recovery remained lower by around 48 bps due to adverse weather conditions. Notably, our decline in recovery was the lowest among mills in eastern UP. The export quota of 1 million tonnes for the ongoing season has strengthened the domestic sugar prices, which are expected to remain robust in the medium term. For the ethanol year 2024-25, the government has permitted the diversion of sugarcane juice and BH molasses for ethanol production. However, deviation from the past practice of the government of linking ethanol price hikes to FRP/sugar prices, has made the sugar diversion unattractive for Juice based ethanol. This will pose a challenge to the industry’s new expansion plans particularly when the government is looking beyond E20. The government's decision not to implement a price increase for BH and Juice based Ethanol, commensurate with the increase in FRP by 11.5% over the last two years, has also contributed to the distillery’s under performance. Progress of our PLA Project remains on-track as per schedule. Uttar Pradesh Government’s pioneering bioplastic policy strengthens the viability of our PLA project by offering an attractive incentive framework. The revised capex now stands at % 2850 (gross) and % 1750 crores (net of expected capital subsidy as announced by the U.P. Government). This higher investment is determined after detailed engineering including on account of increase in capacity of Plant from 75000 TPA to 80000 TPA with lower conversion cost. Over the years, our integrated operations have empowered us to successfully navigate sector headwinds and adapt to evolving industry dynamics. The upcoming PLA bioplastic project aligns seamlessly with our core philosophy of maximizing value from every cane stick. This transformative project strengthens our connections with the farming community, advances our sustainability goals, and represents a natural evolution of our business model. We believe it is well-positioned to drive significant value creation while promoting eco-friendly practices for the future.

We're proud to announce a landmark investment in our state-of-the-art PLA biopolymer plant, this pioneering facility sets two global benchmarks, first to produce PLA from sugarcane at same manufacturing site & also the first PLA plant operating on 100% renewable energy. With cutting-edge technology and industry-leading partners, we're driving efficiency and performance. Our goal is to lead India's biopolymer revolution and make Balrampur Chini Mills the market leader. This PLA venture is risk diversification in the end so that the company has more possibility to maximise the value stream. We like to remain as the first mover and sizeable player in the Indian bioplastics market.