Financial Performance Highlights

Q2 FY27 Performance

  • Revenue from operations: ₹549.2 crores, growing 27.5% year-on-year
  • Total income: ₹549.8 crores, increasing 26.6% year-on-year
  • EBITDA: ₹10.9 crores (improved from loss of ₹4.4 crores in Q2 FY26)
  • EBITDA margin: 2% (improved from negative 1% last year)
  • Net loss: ₹15.2 crores (narrowed from ₹41.6 crores in Q2 FY26)

H1 FY27 Performance

  • Total income: ₹1,109.7 crores, growing 14.6% year-on-year
  • EBITDA: ₹13.4 crores (improved from ₹2.1 crores in H1 FY26)
  • Net loss: ₹34.6 crores (narrowed from ₹57.6 crores last year)

Segment-wise Performance

Bio-based Chemicals Business (Q2 FY27)

  • Revenue: ₹204.2 crores, growing 38.8% year-on-year
  • Segment EBITDA: ₹22.1 crores, growing 47% year-on-year
  • EBITDA margin: 10.8% (improved from 10.2% last year)
  • Q2 FY27 EBITDA represents 46% of annual bio-based chemicals EBITDA for FY26

Bio-based Chemicals Business (H1 FY27)

  • Revenue: ₹372.9 crores, growing 29.3% year-on-year
  • Segment EBITDA: ₹41.2 crores, growing 50% year-on-year
  • EBITDA margin: 11.1% (improved from 9.6% last year)
  • H1 FY27 EBITDA represents 86% of annual bio-based chemicals EBITDA for FY26

Integrated Sugar, Co-generation and Ethanol Business (Q2 FY27)

  • Combined revenue: ₹334.2 crores (compared to ₹275.7 crores last year)
  • Sugar and co-generation segment: EBITDA loss of ₹19.3 crores (improved from loss of ₹23.1 crores in Q2 FY26)
  • Ethanol segment: EBITDA of ₹10.6 crores (improved from ₹4.7 crores last year)

Operational and Strategic Updates

Capacity and Infrastructure

  • Total distillery capacity: 800 kL per day
  • Multi-feedstock capabilities: Can process sugarcane, maize, and FCI-provided rice
  • Grain-based distillery commissioned in Q1 FY27 (end of June 2026)
  • Facility operating at capacity to meet oil marketing company contracts

Expansion Plans

  • ₹25 crores investment in chemical business debottlenecking (announced previous quarter)
  • Target to achieve ₹240 crores quarterly revenue in bio-based chemicals by Q3 FY28
  • Current quarterly revenue at ₹204 crores (exceeded ₹190 crores target)

Product Mix Evolution

  • H1 FY27 product mix: 52% bio-based specialty chemicals, 48% other products
  • Strategic focus on increasing bio-based specialty chemicals portfolio
  • Manufacturing more than 20-25 bio-based specialty chemicals

Innovation and Intellectual Property

  • Received European patents for anti-cancer pharmaceutical composition and bio-based rubber enforcement technology
  • Received Chinese patent for antiviral compounds
  • Subsequent patents received in Mexico and United States for antiviral and anti-cancer research
  • Triple-negative breast cancer drug discovery program advancing toward preliminary efficacy trials
  • Applied for CDSCO permissions for patient trials (expected current quarter)
  • Budget for preliminary efficacy trials: ₹15-20 crores
  • Received FICCI Chemicals and Petrochemicals Manufacturing Process Innovator of the Year Award 2026

DME Project

  • Pilot plant for conversion of carbon dioxide to dimethyl ether (DME) with ICT Mumbai
  • Pilot plant stage expected to complete by March 2027
  • Potential use as LPG substitute for energy security

Industry Environment and Challenges

Market Conditions

  • Global transition toward renewable and bio-based alternatives creating opportunities
  • Fossil resource scarcity due to geopolitical factors
  • Domestic sugar and ethanol industry facing evolving dynamics
  • India achieved E20 blending milestone

Feedstock Challenges

  • Drought conditions in Maharashtra and Karnataka affecting farm economy
  • Government restriction on diversion of sugarcane juice and B-heavy molasses to ethanol
  • Rising maize prices increasing margin pressures on grain-based ethanol production
  • Feedstock availability concerns for upcoming ethanol supply year

Strategic Response

  • Multi-feedstock capabilities providing operational flexibility
  • Ability to cater to fuel ethanol, ENA markets, and bio-based chemicals
  • Focus on optimizing feedstock utilization and balancing opportunities
  • Working with farmers through Agriculture Research Station for high yield technologies

Financial Management

Working Capital

  • Inventory declined significantly from ₹775 crores to ₹260 crores (seasonal variation)
  • Operating cash flow showed approximately ₹65 crores
  • Seasonal nature: High inventory in March (sugar stocks), lower in September
  • Chemical inventory expected to increase pro-rata with business growth

Capital Allocation

  • Priority on bio-based specialty chemicals investments
  • Minor investments in ethanol facility optimization as needed
  • Focus on larger off-take agreements before proceeding with major Greenfield/Brownfield investments

Outlook and Guidance

Seasonal Business Pattern

  • H1 typically negative on profitability, H2 strongly positive
  • Q3 and Q4 expected to be strongly profitable (historical pattern)
  • Sugar operations commence in H2, driving profitability

Expectations

  • Strong sugar prices expected due to poor monsoons and reduced diversion to ethanol
  • Increased sugar production expected due to policy changes
  • Grain-based ethanol production to supplement reduced cane-based ethanol
  • Company expects to be PAT positive in FY27 (was positive last year)

Conference Call Participants

Management:

  • Mr. Samir Somaiya – Chairman and Managing Director
  • Mr. Ashish Sinha – Deputy General Manager, Investor Relations and Finance

Moderator:

  • Ms. Prachi Ambre – MUFG Investor Relations

Analysts Participating:

  • Vivek Gupta (Star Investments)
  • Kranti (WealthMills Securities)
  • Nivesh Verma (Verxora Securities)
  • Hitesh Agarwal (Investment Partners)
  • Suhani Singh (ROS Capital)
  • Snehil Surana (Star Broking)
  • Varun Mishra (SG Capital)