Balrampur Chini Mills Ltd (BCML) anticipates maintaining strong growth momentum, driven by heightened crushing activities and improved yield during the ongoing sugar season from October 2023 to September 2024, according to a senior executive. Besides the organic growth it is experiencing, the company is actively investigating potential “acquisition opportunities” in the inorganic sector.
“I don’t want to stall our growth trajectory. We need to evaluate various opportunities to ensure sustained healthy growth given the favourable government policies. We expect our performance is going to be only better in the years to come,” stated Avantika Saraogi, the Promoter and Business Lead (New Initiatives), without disclosing specific targets.
BCML reported a revenue of INR 4,728 crore for the fiscal year 2022-23. The revenue for the first half of the fiscal year 2023-24 (April-September 2023) surged by 33 percent year-on-year, reaching INR 2,929 crore.
Saraogi, a key contributor to BCML’s success, conveyed optimism about the company’s upcoming performance.
The city-based sugar major, which operates ten sugar factories in Uttar Pradesh with an aggregate sugarcane crushing capacity exceeding 80,000 TCD, remains open to acquisitions for inorganic growth while maintaining organic growth in its existing mills.
She mentioned that initial observations from the ongoing crushing season indicate a yield surpassing 10 percent, attributed to favorable weather conditions, technological interventions introduced by BCML for farmers, and enhanced pest management. In the preceding sugar season, the company successfully processed 10.3 crore quintals of sugarcane.
Her optimism stems from the preponement of the E20 (20 per cent ethanol blend in petrol) target to 2025-26, a move that will ensure a balanced sugar market and foster stable returns for the sugar industry.
Nevertheless, Vinod Kumar Yadav, the CGM & Head of Operations at Haidergarh Sugar Mill, warned that the industry may face challenges due to external factors, such as a sudden rise in the state-advised price (SAP) for sugarcane set by the Uttar Pradesh government.
Yadav urged the state government to consider the industry’s viability before contemplating any increase in the cane support price.
According to Trendlyne Forecaster, Balrampur Chini Mills Ltd is anticipated to generate revenue within the range of INR 5,516 crore to INR 5,824 crore in FY24 and between INR 6,100 crore to INR 6,639 crore in FY25.
Although sugar continues to be the primary focus of BCML, there is a 50% increase in ethanol production, reaching 33 crore litres this year. Sugar constitutes 66% of the company’s revenue, while ethanol makes up nearly 33% of the remaining share.
