Balrampur Chini Mills reports a 15% rise in distillery revenue in the last 5 years
Balrampur Chini Mills has increased its distillery segment revenue from 15% to over 26% in five years, with distillery revenue rising to ₹1,689 crore in FY24. The company’s sugar segment contributed 73.28% of revenue. BCML expanded its distillery capacity to 1,050 KLPD, making it a leading operator in Uttar Pradesh. Despite policy challenges, BCML aims to boost profitability and diversify with a ₹2,000 crore investment in cane-based polylactic acid.
Balrampur Chini Mills, India’s second-largest private-sector sugar manufacturer, has significantly increased its revenue from non-sugar businesses, particularly from its distillery segment, which saw a rise from around 15% to over 26% in the last five financial years, reports The BusinessLine.
The Kolkata-based company is engaged in sugar manufacturing, ethanol production, and cogenerated power. According to the last annual report, “The sugar segment contributed 73.28 per cent while the Distillery segment contributed 26.35 per cent during FY 23-24.”
Revenue from the distillery segment was ₹566 crore in FY20, around 11% of the total revenue of the company. It increased to ₹1,689 crore in the last financial year. Revenue from the sugar segment went up from ₹4,423 crore in FY20 to ₹4,697 crore in FY24.
The Company has made extensive investments in the non-sugar business to diversify its product mix and enable itself to have lesser dependency on sugar. BCML operates, alongside such efforts, five distillery units with an aggregate capacity of 1,050 KLPD, mainly producing ethanol against the backdrop of high demand expectations in the Indian ethanol market. This capacity creation has enabled BCML to be one of the largest operators of distilleries in the Uttar Pradesh Sugar Industry.
“We expanded our distillery capacity to become one of the largest in India within the sugar sector. Despite short-term policy challenges, our distillery business is set to transform our revenue mix, reduce short-term debt, and enhance profitability,” the annual report stated. The company’s distillery capacity was increased from 560 KLPD to 1,050 KLPD in the last financial year.
However, during the second half of the last fiscal year, the Union government imposed restrictions on the free switchover from sugar production to ethanol production. “This may delay our target of generating a third of our revenues from ethanol by a couple of years. Assuming a return to policy status quo before the next sugar season, we expect superior financial performance in FY 25-26,” BCML noted.
BCML made quite a diversification announcement in February: the manufacture of cane-based polylactic acid, a bio-based alternative to single-use and other plastics. This will be the largest in its history, at an investment of ₹2,000 crore, and is aligned with its long-term strategy to reduce dependence on sugar.
Source Link: https://www.chinimandi.com/balrampur-chini-mills-reports-a-15-rise-in-distillery-revenue-in-the-last-5-years/
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