India’s Dalmia Bharat Sugar’s profit falls, export ban squeezes margins
Dalmia Bharat Sugar and Industries reported a 48.8% drop in its second-quarter profit, primarily due to increased inventory costs stemming from India’s sugar export ban, which led to margin contraction. Profit before tax fell to ₹378.9 million from ₹740.2 million a year ago, despite a 26.6% rise in revenue to ₹9.26 billion. Total expenses surged, with inventory costs up nearly 37%, shrinking margins from 9% to 7%. India’s sugar export ban, extended due to lower sugarcane output, has left companies managing high inventory costs.
India’s Dalmia Bharat Sugar and Industries reported a 48.8% decline in second-quarter profit on Monday, hurt by higher inventory costs due to a sugar export ban, which weighed on its margins.The company, which supplies sugar to companies like Coca-Cola, Britannia, Dabur, said its consolidated profit before tax fell to 378.9 million rupees ($4.5 million) for the quarter ended Sept. 30, from 740.2 million rupees year ago.Total expenses rose 26.8%, led by near-37% jump in inventory costs. This resulted in its margins contracting to 7% from 9% a year earlier.
India, the world’s largest sugar consumer and second-biggest producer, banned mills from exporting the sweetener during the 2023/24 season. Since then, domestic sugar companies have been grappling with increased inventory costs as stocks pile up.
The government plans to extend the export ban for a second straight year amid prospects of lower sugar cane output, Reuters reported last month.
Source Link : https://theprint.in/india/indias-dalmia-bharat-sugars-profit-falls-export-ban-squeezes-margins/2332471/
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