Balrampur Chini Mills (Q1 FY14)
India Infoline News Service | Mumbai |
Revenues declined 1.5% yoy on lower sugar volumes though free sugar realization improved 7.5% yoy; co-gen sales rose 17.6% yoy driven by 12% increase in surplus power volumes.
CMP Rs37, Target Rs45, Upside 20.8%
Source: Company, India Infoline Research
Operating highlights
Source: Company, India Infoline Research
Financial summary
-
Higher cane costs and lower sugar realizations impacted Balrampur Chini’s Q1 FY14 results as company took write down on sugar inventory amidst lower market prices compared to cost of production for the company
-
Revenues declined 1.5% yoy on lower sugar volumes though free sugar realization improved 7.5% yoy; co-gen sales rose 17.6% yoy driven by 12% increase in surplus power volumes. Distillery volumes were lower yoy as ethanol sales (0.15mn ltrs) started only from June 2013. RS & ENA volumes, on the other hand, jumped 51% yoy to ~18.7mn ltrs
-
EBIDTA margin declined 108bps yoy as company took write down on sugar inventory; however, EBIT margin for byproducts improved yoy due to healthy realizations
-
Sugar prices have stayed relatively benign compared to cane cost leading to inventory write down during the quarter; we cut our full year sugar realizations and accordingly revise lower our FY14/15 EPS estimates and 9-12 target price to Rs45 but retain BUY.
| (Rs m) |
Q1 FY14 |
Q1 FY13 |
% yoy |
| Net sales |
6,816 |
6,920 |
(1.5) |
| Material costs |
(5,631) |
(5,743) |
(1.9) |
| Staff costs |
(294) |
(263) |
12.1 |
| Other overheads |
(402) |
(343) |
17.2 |
| Operating profit |
489 |
572 |
(14.4) |
| OPM (%) |
7.2 |
8.3 |
(108) bps |
| Depreciation |
(266) |
(274) |
(3.0) |
| Interest |
(400) |
(535) |
(25.2) |
| Other income |
79 |
57 |
39.5 |
| PBT |
(98) |
(180) |
(45.9) |
| Tax |
- |
- |
- |
| PAT |
(98) |
(180) |
(45.9) |
Operating highlights
| Operating performance |
Q1 FY14 |
Q1 FY13 |
% yoy |
| Cane crushed |
0.7 |
0.2 |
334.5 |
| Sugar produced |
0.07 |
0.02 |
316.0 |
| Recovery (%) |
10.0 |
10.5 |
- |
| Sugar sales (mn tons) |
0.17 |
0.19 |
(10.7) |
| Free sugar realizations, Rs/kg |
31.9 |
29.7 |
7.5 |
| Distillery production, mn ltrs |
26 |
22 |
16.9 |
| Distillery sales, mn ltrs |
19 |
20 |
(5.7) |
| Avg alcohol realization, Rs/l |
29.6 |
26.4 |
11.8 |
| Power production, mn units |
237 |
205 |
15.8 |
| Power sales, mn units |
194 |
173 |
12.1 |
| Avg realization (Rs/unit) |
4.3 |
4.2 |
1.9 |
Financial summary
| Y/e 31 Mar Rs m |
FY12 |
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