Global Economic Scenario: A Year of Transition, Tensions and Tactical Recovery
The global economy in 2024 navigated a complex interplay of resilience and risk. While moderate growth was sustained with the IMF projecting 3.2% and 3.3% growth in 2024 and 2025, respectively the backdrop was shaped by intensified geopolitical tensions, widespread electoral activity and persistent supply-side disruptions.
Geopolitical and Structural Headwinds
2024 marked an unprecedented year for global elections, with over half the worlds population casting votes in national polls. Simultaneously, geopolitical conflicts especially the prolonged Russia-Ukraine war and renewed tensions in the Middle East through the Israel-Hamas conflict exacerbated energy and food insecurity, placing renewed stress on commodity markets. The Suez Canal, a critical trade artery, faced disruptions leading to rerouted shipments via the Cape of Good Hope, increasing average delivery timelines and freight rates. Cybersecurity threats intensified amid the digitalisation of critical infrastructure, adding a new layer of economic vulnerability. Meanwhile, shifting trade policies and rising protectionism have reshaped global supply chains, contributing to greater financial market volatility and geopolitical risk premia.
Regional Divergence in Growth
While global GDP grew by 3.3% in 2023 and is projected to grow at a stable 3.2-3.3% annually through 2025, regional dynamics are sharply divergent. The US economy continued to surprise on the upside, with strong consumption and job market stability, though a modest cooling is expected in 2025. In contrast, the Eurozones recovery has been sluggish, particularly in manufacturing-heavy economies like Germany and Austria, which continue to grapple with weak external demand and structural inefficiencies. Political uncertainties in major European economies have further clouded the investment climate. Meanwhile, Asias performance was mixed Japan struggled with early-year supply disruptions, and China faced dampened growth due to weak private investment and continued real estate distress. India, however, emerged as a high-growth performer, leading global output expansion.
Manufacturing Lags, Services Lead
The global services sector remained the mainstay of economic expansion in 2024, buoyed by post-pandemic recovery in mobility, travel, and consumption. This strength was reflected in the global composite Purchasing Managers Index (PMI) staying above the 50-mark for over a year. However, manufacturing activity continued to face headwinds, with the PMI dipping back into contractionary territory by mid-2024. The sectors challenges stemmed from reduced investment goods demand, regional disparities, and ongoing supply chain disruptions. Despite these setbacks, consumer and intermediate goods production provided some offset, and output remained resilient in economies like India. However, sentiment in global manufacturing softened, with business confidence falling to a three-month low by December.
Disinflation Progress with Lingering Risks
Headline inflation eased across most economies in 2023 and 2024, owing to tighter monetary policies and the softening of global fuel prices. The cooling of goods inflation further supported this trend. However, the persistence of services inflation, driven by rising nominal wages and demand-side strength, has slowed the pace of disinflation. Global shipping disruptions, including those in the Red Sea and at the Panama Canal, led to a resurgence in freight costs, reflected in the elevated Global Supply Chain Pressure Index in late 2024. While commodity prices are projected to decline moderately over the next two years, the potential for synchronised price increases remains. Factors such as climate shocks and geopolitical escalations could still ignite inflation flare-ups, challenging central banks disinflation goals.
Policy Pivot and Monetary Uncertainty
In response to easing inflation, several advanced economies initiated a pivot in monetary policy by reducing benchmark interest rates. However, the extent and pace of these rate cuts vary by country, reflecting differences in economic resilience, inflationary trends, and domestic demand. In the US, market expectations have consistently misjudged the actual trajectory of the Federal Funds Rate, creating further uncertainty. Policymaker forecasts, as seen in the Federal Reserves dot-plot projections, now show a wider range of views on terminal rates, highlighting the unpredictability in long-term rate paths. While sovereign bond yields trended lower in AEs during mid-2024, renewed concerns over inflation and monetary tightening led to an uptick in yields by year-end. China, on the other hand, saw deflationary pressure bring its bond yields down, widening the spread between the worlds two largest economies.
Outlook: Uncertainty Casts a Long Shadow
The global economic outlook, while stable in aggregate, remains precarious. Elevated geopolitical tensions, lingering policy uncertainties, and rising trade restrictions are significant downside risks. Disruptions in global shipping routes, rising costs, and delays continue to weigh on global trade activity. The stock of import-restrictive measures within G20 economies now covers 12.7% of imports three times more than in 2015 threatening global trade growth and economic integration. If such protectionist trends continue, they may dampen investment, stifle innovation, and undercut long-term global growth potential. Policymakers must therefore strengthen domestic economic levers while fostering international cooperation to safeguard a fragile recovery.
In addition to geopolitical and trade related headwinds, the global economy is increasingly exposed to intersecting structural challenges. Climate induced disruptions, volatile commodity markets, and divergent monetary policy trajectories are amplifying macroeconomic imbalances, particularly in vulnerable economies with limited fiscal buffers. Rising sovereign debt levels and tightening global financial conditions have constrained policy space in many low and middle income countries, impeding their capacity to respond effectively to external shocks. In this context, safeguarding the momentum of global recovery demands a recalibration of multilateral cooperation centered on resilient trade architecture, targeted development finance, and enhanced cross-border coordination. Failure to do so risks entrenching economic fragmentation and reversing gains in global poverty reduction and inclusive growth.
Indian Economic Overview
Indias Ascent Amid Global Headwinds
Amidst heightened global uncertainty and subdued macroeconomic sentiment, India has emerged as a key outlier with strong and sustained economic momentum. The United Nations World Economic Situation and Prospects (WESP) mid-year update (2025) identifies India as the fastest-growing major economy, projecting a GDP growth rate of 6.3% in FY 2024-25, with growth expected to strengthen to 6.4% in FY 2025-26. This performance stands in sharp contrast to the global slowdown, which is marked by rising trade frictions, financial volatility and geopolitical tensions.
Macroeconomic Stability and Domestic Demand-Led Growth
Indias growth continues to be driven by robust domestic demand, proactive government expenditure, and relatively stable macroeconomic fundamentals. Inflation is projected to moderate to 4.3% in 2025, remaining within the Reserve Bank of Indias target range. Stable employment conditions and effective monetary and fiscal policy coordination have supported overall consumption and investment levels. Indias performance reflects a resilient economy anchored in structural reforms, digitalisation and a targeted approach to inclusive development.
Indias medium-term outlook remains strong, driven by sustained infrastructure investment, industrial policy reforms, and digital transformation. Initiatives like the PLI scheme and expanding digital public infrastructure are enhancing productivity and attracting global capital. As India integrates further into global value chains, leveraging its demographic dividend through targeted skilling and employment strategies will be key. Continued focus on institutional efficiency, fiscal discipline and inclusive policy execution will be critical to sustaining long-term, broad-based growth.
India Becomes the Worlds Fourth Largest Economy
India has now officially surpassed Japan to become the worlds fourth-largest economy, with a GDP of $4.3 trillion, according to the International Monetary Fund (IMF). The only countries with larger economies are the United States, China, and Germany. Following the 10th Governing Council Meeting of NITI Aayog, it was highlighted that India is on track to overtake Germany and become the third-largest economy globally within the next 2.5 to 3 years.
Indias economy has more than doubled from $2.1 trillion in 2015 to $4.3 trillion in 2025, and is expected to reach $5.5 trillion by 2028. In contrast, Germanys projected GDP growth is set to remain subdued at 0% in 2025 and 0.9% in 2026, weighed down by trade frictions and structural economic challenges setting the stage for Indias continued ascent on the global economic leaderboard.
Capital Markets: Deepening Participation and Global Integration
Indias capital markets have demonstrated strength and resilience, becoming a critical driver of investment and resource mobilisation. As of December 2024, equity indices reached historic highs, outperforming many emerging market peers. The retail investor base expanded significantly from 4.9crore in FY20to 13.2 crore in December 2024, indicating growing investor confidence and financial inclusion.
The primary markets witnessed remarkable activity with a 32.1% increase in IPOs and nearly a threefold rise in capital raised, from Rs.53,023 crore to Rs.1.54 lakh crore during April-December 2024. Indias global IPO share surged to 30%, making it the largest contributor to global IPO mobilisation. Notably, multinational corporations such as Hyundai and LG have chosen to list their Indian subsidiaries locally, reinforcing Indias appeal as a strategic capital market hub.
Indias capital markets have matured into a key pillar of economic growth, supported by strong regulatory frameworks, rising investor participation, and robust digital infrastructure. SEBIs reforms and market transparency have enhanced global investor confidence, while the surge in retail activity has deepened market liquidity. As India advances its $5 trillion economy vision, capital markets will play a central role in financing infrastructure, clean energy, and innovation. Strengthening the corporate bond market and aligning with global ESG standards will be essential to sustain momentum and reinforce Indias position as a global financial hub.
Manufacturing Sector: Steady Expansion and Policy Support
Indias manufacturing sector has exhibited consistent growth, supported by enabling policy frameworks such as the Production-Linked Incentive (PLI) schemes and the Make in India initiative. The sectors Gross Value Added (GVA) at constant prices increased from ^ 15.6 lakh crore in 2013-14 to Rs.27.5 lakh crore in 2023-24, with its share in GDP holding steady at 17.3%.
Indias total exports in FY 2024-25 reached an all-time high of USD 824.9 billion, up 6.01% year-on-year. This represents a significant leap from USD 466.2 billion in 2013-14, highlighting the countrys expanding footprint in global trade. The steady rise in non-petroleum merchandise exports reaching USD 374.1 billion demonstrates growing manufacturing strength in strategic sectors, including electronics, pharmaceuticals, and defence.
Indias manufacturing and export performance reflects a structural shift towards high-value, technology-driven production. Strategic interventions such as the Production-Linked Incentive (PLI) schemes and the Make in India initiative have bolstered domestic capacity, enhanced global competitiveness, and attracted significant foreign investment. The steady rise in non-petroleum exports led by electronics, pharmaceuticals, and defence manufacturing demonstrates the sectors diversification and move up the value chain. Concurrently, proactive trade diplomacy and expanded bilateral agreements have improved market access and reduced concentration risks. As India continues to strengthen its industrial base, the manufacturing sector is poised to play a central role in driving sustained growth, employment generation, and economic resilience.
Services Sector: Sustaining Global Competitiveness
Indias services exports continue to be a cornerstone of its external sector performance. In FY 2024-25, services exports reached a record USD 387.5 billion, growing 13.6% from the previous year. March 2025 alone saw exports rise 18.6% year-on-year, signaling enduring competitiveness in areas such as IT, financial services, and professional consulting. Since 2013-14, when services exports stood at USD 152 billion, the sector has more than doubled, contributing substantially to foreign exchange earnings and employment.
Defence Production and Exports: Advancing Self-Reliance
Indias defence manufacturing sector has undergone a significant transformation over the past decade. In FY 2023-24, indigenous production reached Rs.1.27 lakh crore, marking a 174% increase over FY 2014-15. This shift has been enabled by a strong policy focus on indigenisation, capacity building, and strategic procurement.
Defence exports have surged from Rs.686 crore in 2013-14 to Rs.23,622 crore in 2024-25, a 34-fold increase, with Indian defence products now exported to nearly 100 countries. This growth exhibits Indias emergence as a credible supplier in the global defence value chain and reflects its broader ambition of becoming a self-reliant, innovation-led manufacturing hub.
Conclusion: A Forward-Looking Growth Model
Indias economic trajectory, as acknowledged by the United Nations and evidenced by a broad set of macroeconomic indicators, reflects a compelling blend of structural resilience, policy stability, and sustained investor confidence. Amid a complex global environment marked by geopolitical tensions, tightening financial conditions, and trade realignments, India has emerged as a key pillar of economic dynamism. Its diversified growth engines spanning advanced manufacturing, high-value services, expanding capital markets, and competitive exports underscore the countrys evolving economic architecture. Strategic reforms in taxation, digital infrastructure, labour laws, and industrial policy have further strengthened the enabling environment for long-term investment and enterprise-led growth.
Looking ahead, the continuation of this upward trajectory will hinge on three imperatives: accelerating the pace of second-generation reforms to enhance productivity and governance; deepening capital formation to finance infrastructure, innovation, and sustainability transitions; and forging greater integration into global value chains through trade facilitation, regulatory convergence, and diplomatic engagement. Together, these levers will not only fortify Indias macroeconomic fundamentals but also position the country as a pivotal contributor to global stability, inclusive development and sustainable growth in the decades to come.
INDUSTRY STRUCTURE AND DEVELOPMENTS
Overview of the Global Biofuels Sector
Global biofuel market and growth outlook
According to a study by the international Energy Agency (IEA), global demand for biofuels is projected to grow at an annual rate of 2.3% between 2022 and 2026, reaching a total volume of approximately 1,860 billion litres. While the United States will continue to lead in volume growth, a significant portion of this increase reflects a recovery from the pandemic-driven decline. Notably, Asia is expected to account for nearly 30% of the additional global biofuel production during this period, surpassing Europe by 2026. This shift is largely driven by strong domestic policies, rising liquid fuel demand, and export-oriented strategies, particularly in South and Southeast Asia. India is poised to play a key role in this transition, supported by ambitious ethanol blending targets and recent policy reforms, potentially becoming the third-largest ethanol market globally by 2026. Indonesia and Malaysia are also expected to contribute significantly, expanding their biodiesel production capacity to meet both domestic and regional demand.
The global biofuels market is set to grow steadily through 2025, underpinned by robust government mandates, evolving clean energy frameworks, and expanding technological capabilities. The IEA projects biofuels to contribute nearly two-thirds of the total renewable energy growth in the transport sector by 2030, with ethanol, biodiesel and Sustainable Aviation Fuel (SAF) emerging as key enablers in decarbonizing road and aviation segments. While the pace of progress will differ across geographies, the global trajectory remains strongly positive.
| Asia Pacific | Strong policies, export focus, growing fuel demand | High | Ethanol, Biodiesel |
| Europe | Europe Regulatory mandates {RED 111, SAF), fraud oversight | Moderate to High | SAF, Advanced Biofuels |
| North America | EPA & Clean Fuel mandates, steady export demand | Moderate | Ethanol, Renewable Diesel |
| Latin America | High ethanol output, supportive mandates | Stable | Sugarcane Ethanol, Biodiesel |
| Africa | Emerging mandates, supply & infrastructure gaps | Emerging | Future local applications |
In Asia Pacific, the transition to low-carbon fuels is accelerating as countries seek to enhance energy security and reduce import dependency. India is expected to achieve its 20% ethanol blending target by the second half of 2025. Indonesia, Malaysia, and Thailand are progressing toward higher biodiesel blends, while China is increasing domestic biodiesel consumption in response to EU trade actions. The Philippines and other nations in the region are also expanding their ethanol and biodiesel blending mandates. According to the IEA, Asia will remain the leading growth region for first-generation biofuels, while gradually incorporating advanced biofuel technologies.
Europe continues to lead through a regulatory-driven approach. The implementation of the RED III Directive, combined with binding SAF mandates and maritime emissions targets, is driving sustained adoption of biofuels across transport modes. Tools such as the Union Database for Biofuels are enhancing transparency and combating fraud, reinforcing market credibility. The IEA identifies Europe as a critical region for the scale-up of advanced biofuels, especially in sectors that are harder to electrify, such as aviation and freight.
In North America, the biofuels sector benefits from strong policy support and established infrastructure. The U.S. Environmental Protection Agencys 2025 targets ensure continuity in ethanol and renewable diesel demand, while Canadas Clean Fuel Regulations are prompting increased blending across provinces like Ontario and Quebec. Export demand for U.S. ethanol remains strong, particularly from countries such as India and the UK. However, the IEA cautions that potential shifts in political leadership and funding priorities could influence the trajectory of federal clean energy incentives.
Latin America maintains a mature and well-integrated biofuels ecosystem. Brazil, the worlds second-largest ethanol producer, is raising its biodiesel blending mandate to B15, reinforcing its leadership in bioenergy. Meanwhile, Colombia and Paraguay are scaling ethanol production and expanding domestic consumption. The IEA recognizes Latin America as a long-term hub for sugarcane-based ethanol, supported by favorable climatic conditions and established supply chains.
In Africa, biofuel development is in its early stages, but the foundations are gradually being laid. Countries like Uganda and South Africa have introduced blending mandates, although implementation remains dependent on infrastructure investment and the development of local feedstock supply chains. The IEA emphasizes that with targeted support and investment, Africa could emerge as a future contributor to the global biofuels landscape, particularly for decentralized and rural applications.
As the biofuels sector enters a phase of strategic acceleration, global cooperation will be vital to unlock its full potential as a cornerstone of the energy transition. The path forward demands not only technological innovation and policy ambition, but also coordinated efforts to harmonize sustainability standards, de-risk investments, and enable equitable access to finance particularly for emerging and resource-constrained economies. Institutions such as the Global Biofuels Alliance have a critical role to play in shaping a unified vision, fostering South-South collaboration and promoting resilient cross-border value chains. In this emerging architecture, India stands at a unique intersection as both a high-growth market and a thought leader actively advancing integrated bioenergy models and catalyzing global dialogue on sustainable mobility. Its ability to convene, collaborate, and lead will be instrumental in steering the global biofuels narrative toward inclusive, secure, and climate-resilient energy futures.
Overview of the Indian Biofuels Sector
India biofuel market and growth outlook
Indias Rapid Emergence in the Global Biofuels Landscape
India has rapidly positioned itself as a major player in the global biofuels space, becoming the worlds third-largest producer and consumer of ethanol, according to the international Energy Agency (IEA). This growth is a direct outcome of comprehensive policy interventions, high-level political backing, and abundant agricultural feedstock availability. The momentum has been further strengthened by Indias proactive role in fostering international cooperation through the Global Biofuels Alliance (GBA), which it launched in 2023 alongside eight other countries to catalyse the deployment of sustainable biofuels globally
Policy Foundation and Domestic Targets
The foundation for Indias biofuel ambitions was laid with the National Policy on Biofuels (2018), which introduced blending targets and a multi-ministerial coordination mechanism. The policy was updated in 2022 to reflect Indias accelerated goals, most notably the advancement of the 20% ethanol blending target from 2030 to 2025-26. Additional mandates include 5% biodiesel blending by 2030,5% compressed biogas (CBG) blending by 2028-29, 2% sustainable aviation fuel (SAF) blending by 2028, and 7% co-firing of biomass in coal-based power plants by 2026. These targets are underpinned by policy enablers such as guaranteed pricing, long-term procurement contracts, viability gap funding, and standardisation of fuel specifications.
Production Growth and Market Outlook
Over the past five years, Indias ethanol production has nearly tripled, placing the country on a steep growth trajectory. As per the lEAs Renewable Energy Market Update (2024), India is forecast to be the fastest-growing bioenergy market in the world between 2023 and 2030, contributing over one-third of the global increase in bioenergy demand. If the current policy momentum is maintained, liquid biofuel demand (ethanol, biodiesel, and biojet fuel) could quadruple by 2030. This growth is essential not only for energy diversification and rural economic upliftment but also for achieving national decarbonisation goals in hard-to-abate sectors like aviation and heavy transport.
Feedstock Sustainability and Supply Chain Considerations
According to IEA, Bioenergy in India excluding traditional uses for fuel wood, currently utilises over 180 million tonnes of feedstock per year, sourced from sugarcane, corn, agricultural residues, manure, and municipal solid waste. However, the IEA estimates that feedstock demand must grow by approximately 50% by 2030 to meet anticipated biofuel, biogas, and biomass requirements. This will necessitate a significant upgrade in feedstock collection infrastructure, especially for underutilised streams such as used cooking oil, organic municipal waste, and crop residues.
Furthermore, traditional biomass use, primarily for household cooking, still accounts for around 40% of total bioenergy consumption. Phasing out these traditional uses is critical for improving indoor air quality, reducing ecological strain, and freeing up biomass for modern energy applications. The IEA stresses the need for comprehensive, centralised feedstock assessments to avoid duplication and enhance allocation efficiency across ethanol, CBG and biomass pathways.
Technology Deployment and Innovation Needs
While Indias first-generation biofuel technologies have gained maturity, the next leap in production will require commercialisation of second-generation biofuels. The IEA notes that lignocellulosic feedstocks, such as agricultural waste, have the theoretical potential to yield 1.4 EJ (exajoules) of ethanol far exceeding Indias current output of 0.1 EJ. These technologies, though initially cost-intensive, are expected to become competitive with scale and innovation. The development of mixed-feedstock biogas plants, advanced digesters, and efficient conversion technologies will be crucial for sustaining long-term growth.
The Global Role: India and the Biofuels Alliance
Indias leadership in establishing the Global Biofuels Alliance (GBA) reflects its rising stature as a key architect of the global clean energy transition. At a time when over 80% of global biofuel production is concentrated in a handful of regions despite increasing transport fuel demand across the Global South this imbalance underscores the urgent need for a more equitable and diversified biofuels landscape. The GBA presents a timely and strategic platform to address this gap by:
| Expand market penetration in underrepresented regions | Accelerate adoption of advanced technologies | Harmonise GHG performa nce-based sustainability standards |
Anchored in these priorities, the GBA can harness Indias institutional experience, policy innovation, and multilateral engagement to catalyse coordinated global action. Establishing regional centres of excellence for technology cooperation, policy advisory and capacity development will enable countries to implement context-specific biofuel strategies. A harmonised global sustainability certification framework digitally enabled and transparently governed can enhance supply chain traceability and build investor and consumer confidence. Equally critical will be the creation of innovative financing mechanisms and blended finance models to mitigate risk and mobilise capital at scale, particularly in emerging markets. Collectively, these measures can drive the development of a more inclusive, resilient and future-ready global biofuels ecosystem.
Indias domestic biofuel journey driven by targeted policies, institutional commitment, and stakeholder alignment has already emerged as a benchmark for integrated, sustainable energy planning. With continued emphasis on innovation, climate ambition and global cooperation, India is uniquely positioned to steer the next phase of bioenergy growth. Through the GBA, it has the opportunity to shape a shared global agenda one that advances clean transport, enhances energy security and supports equitable, low-carbon development across economies.
Ethanol demand in India is expected to grow at a CAGR of 17.7% till Fiscal 2026.
Ethanol Demand Growth:
¦ Ethanol demand in the Ethanol Blended Petrol (EBP) Program is projected to grow from 548 crore litres in Fiscal 2023 to 1,016 crore litres by Fiscal 2026.
¦ This represents a robust growth, driven by advancing the 20% blending target to 2025 from 2030 and a shift towards 2G ethanol.
Total Ethanol Market Expansion:
¦ The overall ethanol market, including ethanol for other uses, is estimated to grow from 828 crore litres in 2022-2023 to 1,350 crore litres by 2026.
¦ This growth highlights Indias commitment to increasing ethanol utilization across various applications, including bio-diesel, flex-fuel vehicles, cooking fuel, and sustainable aviation fuel.
Ethanol blending in petrol was 19.7% during April 25 and cumulative ethanol blending during Nov 24 to
April 25 was 18.%
Second Generation (2G) ethanol:
Studies indicate that Lignocellulosic surplus biomass availability in India is around 12-16 crore tons per annum. If used to good advantage, this has potential to yield 2500 to 3000 crore litres of Ethanol per annum and has potential to reduce Indias dependence on imported crude oil considerably.
2G Ethanol Biorefineries produce cellulosic ethanol and valuable by-products like biogas, liquid C02, pellets, and compost, supporting horticulture and reducing chemical fertilizer use. These biorefineries will boost rural socio-economic development by providing income to farmers and creating numerous jobs. They also hold potential for high-value by-products like furfural and xylitol, enhancing profitability. 2G ethanol supports local fuel needs, with significant opportunities in the aviation sector for sustainable aviation fuels (SAF) and in automotive fuel efficiency and emission reduction. It can also generate renewable electricity, contributing to energy security.
Additionally, 2G ethanol serves as a feedstock for bioplastics and biochemicals, promoting sustainable manufacturing. The government is fostering 2G ethanols viability through initiatives like the PM JI-VAN Yojana, supporting a sustainable and profitable bioeconomy.
| Surplus Biomass Availability | 12-16 crore tons per annum |
| Potential Ethanol Yield | 2,500 to 3,000 crore litres per annum |
| Impact on Crude Oil Dependence | Significant reduction in dependence on imported crude oil |
| By-Products of 2G Ethanol | co2 |
| Socio-Economic Impact | Provides income to farmers, Creates numerous jobs |
| High-Value By-Products | Supports production of sustainable aviation fuels (SAF), Enhances automotive fuel efficiency, Reduces emissions |
| Energy Security | Reduces dependency on crude imports |
| Sustainable Manufacturing | Serves as feedstock for bioplastics and biochemicals |
| Government Initiatives | PM Jl-VAN Yojana: Fosters 2G ethanol viability, Supports sustainable and profitable bioeconomy |
Indian Sustainable Aviation Fuel (SAF) Market
Indias aviation sector is rapidly growing, with a 12.5% increase in ATF consumption in February 2024 compared to the previous year. The total ATF consumption from April to February FY 2023-24 reached 6.8 million metric tons, up 11.9% year-on-year.
The global aviation industry has set an ambitious net-zero carbon emission target by 2050, which is focused on delivering maximum reduction in emissions at source using SAF, innovative new propulsion technologies and other efficiency improvements.
SAF demand is expected to begin from 2025 and would play an important role in ensuring the Net Zero emission targets globally.
SAF market in India is in nascent stages. The Indian government has set SAF targets to begin from 2027 and for international flights initially. This presents significant investment opportunities, aligning with environmental standards and supporting Indias aviation industrys growth.
| 1% | 2027 | 14 crore litres |
| 2% | 2028 | 28 crore litres |
| 5% | 2030 | 70 crore litres |
Indian Biodiesel Market
Indias biodiesel sector is steadily gaining momentum as the country looks for cleaner, more sustainable alternatives to fossil fuels. With increasing concerns over energy security, environmental degradation and rising crude oil imports, biodiesel has emerged as a viable solution to reduce dependence on conventional diesel. The government initiated efforts to develop this sector with the launch of the National Biodiesel Mission in 2002-03, which aimed to promote biodiesel from non-edible oilseeds like jatropha. This momentum was reinforced with the introduction of the National Biofuels Policy, 2018, which established a target of achieving 5% biodiesel blending with diesel by 2030 a goal that translates into a demand for nearly 4.5 billion litres of biodiesel annually.
Despite the ambitious targets, the Indian biodiesel industry currently relies heavily on imported raw materials. Approximately 90% of the biodiesel produced in the country comes from imported palm stearin, a by-product of palm oil processing, while the rest is derived from animal tallow, used cooking oil and acid oil. This dependence on imported feedstocks underscores a major challenge: the limited availability of domestically sourced raw materials. Indias potential to grow non-edible oilseed crops at scale remains largely untapped and technological limitations in collection, processing and refining infrastructure further hinder the industrys ability to scale up sustainably. In addition, the sector faces logistical challenges related to storage, transportation and blending capabilities across the supply chain.
Nevertheless, the future of biodiesel in India holds significant promise. With growing interest from both public and private stakeholders, the sector is witnessing increased investments in research, technology and feedstock diversification. Initiatives to convert waste cooking oil into biodiesel, explore algae and microbe-based production methods and revive interest in indigenous oilseed plantations are gaining traction. Moreover, the potential of biodiesel to create rural employment, enhance agricultural income and contribute to Indias climate commitments adds a strong socio-economic dimension to its appeal. As government policies evolve and industry players collaborate, biodiesel is well-positioned to become a key component of Indias low-carbon energy transition.
India Compressed Biogas (CBG) Market
India is steadily progressing toward its vision of becoming a gas-based economy by aiming to increase the share of natural gas in its energy mix from 6.7% in December 2023 to 15% by 2030. While this transition is vital for cleaner energy and reduced carbon emissions, India still imports nearly 45%-50% of its natural gas requirements, a figure expected to rise further due to surging demand. In this context, Compressed Biogas (CBG) emerges as a promising alternative that can help offset import dependence while enhancing energy security. CBG, derived from agricultural residues, animal waste and organic municipal waste, holds the potential to substitute conventional natural gas in various applications such as transportation, industrial use and household fuel. CBG production also yields biodigestate, a nutrient - rich organic by-product that acts as a natural soil enhancer and reduces the application of chemical fertiliszers in the long run. Recognizing this, the Government of India is aggressively promoting CBG as a strategic component of the countrys expanding biofuel portfolio under initiatives like the Sustainable Alternative Towards Affordable Transportation (SATAT) scheme.
The biogas sector in India is witnessing a revival, with significant momentum building post the COVID-19 slowdown. According to market projections, Indias biogas market is anticipated to reach USD 2.25 billion by 2029, growing at a compound annual growth rate (CAGR) of 6.3% between 2022 and 2029. This growth is being propelled by an influx of investments from major Indian and international corporations, Public Sector Undertakings (PSUs), and grassroots entrepreneurs. With policy support, technological advancements and the governments push toward energy diversification, the sector is set to play a pivotal role in the green energy transition. CBG not only provides a sustainable and cleaner fuel option but also supports rural economies by creating jobs, enhancing waste management practices and reducing greenhouse gas emissions — making it a vital pillar in Indias journey toward a self-reliant and low-carbon energy future.
Green Hydrogen
India is at the forefront of a transformative shift in its energy landscape, with the launch of the National Green Hydrogen Mission in January 2023. With a total outlay of Rs. 19,744 crore, the Mission sets a bold target of achieving 5 million metric tonnes (MMT) of green hydrogen production per annum by 2030. The overarching goal is to make India a global hub for the production, utilization, and export of green hydrogen and its derivatives—thereby advancing energy security, industrial decarbonization, and sustainable economic growth.
The Mission is structured around key components that together aim to build a robust and self-sustaining green hydrogen ecosystem. These include demand creation through both domestic applications and export markets, incentive-linked production schemes under the SIGHT (Strategic Interventions for Green Hydrogen Transition) programme, and pilot projects across sectors such as steel, mobility, shipping, biomass-based hydrogen, and decentralized energy. Simultaneously, a strong push is being made to establish Green Hydrogen Hubs and enable critical infrastructure like pipelines, storage, and renewable power linkages. Regulatory frameworks, R&D initiatives through public-private partnerships, and skill development and outreach programmes form the foundation of long-term capacity building.
Since its launch, the Mission has begun transitioning from policy intent to real-world implementation. The Solar Energy Corporation of India (SECI) has already awarded production capacity for nearly 862,000 tonnes per annum of green hydrogen and 3 GW of electrolyzer manufacturing. Several state governments—such as Gujarat, Maharashtra, Uttar Pradesh, Andhra Pradesh, and Rajasthan—have also rolled out supportive green hydrogen policies offering land, capital incentives, and grid access concessions to attract investment. At the project level, Indian Oil Corporation is setting up one of the countrys largest green hydrogen plants at its Panipat refinery, while private sector players like Reliance, Adani, and L&T are advancing mega green energy complexes, technology alliances, and export-focused ventures.
BUSINESS ENVIRONMENT AND OUTLOOK
Indias biofuels sector has evolved into a strategic cornerstone of the nations clean energy transition, economic self-reliance, and climate objectives. No longer a peripheral alternative, biofuels are now central to Indias energy security strategy, offering a compelling value proposition that intersects environmental stewardship, rural development, and industrial innovation. The sectors transformation is firmly aligned with Indias vision of Viksit Bharat 2047 and the commitment to achieving net zero emissions by 2070.
The National Policy on Biofuels 2018, as amended in 2022, advanced the target of achieving 20 percent ethanol blending in petrol from 2030 to the Ethanol Supply Year 2025 26. Public Sector Oil Marketing Companies achieved the 10 percent blending target five months ahead of schedule in June 2022 during ESY 2021 22. Ethanol blending has since continued to grow steadily, reaching 12.06 percent in ESY 2022 23, 14.60 percent in ESY 2023 24, and 17.98 percent as on 28 February 2025 in ESY 2024 25, with a projected 18 percent by the end of the supply year.
As of ESY 2023 24, ethanol blending by Oil Marketing Companies reached 707 crore litres, up from just 38 crore litres in ESY 2013 14. This represents an increase of nearly 19 times over a decade and demonstrates the effectiveness of targeted interventions, infrastructure build out, and strong institutional support. The Ethanol Blended Petrol Programme, implemented nationwide, promotes the use of domestically produced and environmentally sustainable fuels. Over the past ten years, the programme has led to foreign exchange savings of over Rs. 1,13,007 crore and has substituted approximately 193 lakh metric tonnes of crude oil, contributing significantly to energy independence.
Indias ethanol production capacity has expanded to 1,713 crore litres per annum. This growth is supported by a range of enablers including long term off take agreements to set up dedicated ethanol plants in ethanol deficit states, encouragement for conversion of single feed to multi feed distilleries, availability of E100 and E20 fuel blends at retail outlets, and the launch of flexi fuel vehicles. These measures also support ease of doing business and contribute to the objectives of Atmanirbhar Bharat. A publicly available roadmap for ethanol blending in India between 2020 and 2025 further provides clear direction for coordinated implementation and investment planning.
India has also advanced its agenda on Compressed Biogas through the introduction of the CBG Blending Obligation, which aims to drive demand creation, enable import substitution of liquefied natural gas, promote circular economy, and contribute to the national net zero targets. The policy is expected to catalyse investment of around Rs.37,500 crore and facilitate the development of 750 CBG plants by FY 2028 29. The CBG Blending Obligation will remain voluntary until FY 2024 25, after which mandatory blending obligations will be introduced. The mandate will begin with 1 percent of total CNG and PNG consumption in FY 2025 26, rise to 3 percent in FY 2026 27,4 percent in FY 2027 28, and reach 5 percent from FY 2028 29 onwards. A Central Repository Body will be established to monitor and implement the blending mandate under operational guidelines approved by the Ministry of Petroleum and Natural Gas.
Indias annual biomass production is approximately 750 million metric tonnes, out of which an estimated 228 million metric tonnes is classified as surplus biomass, available for conversion into biofuels and bioenergy. This substantial resource base forms the foundation for scaling second generation ethanol, compressed biogas, and other advanced biofuels. By leveraging surplus biomass including agricultural residues, crop waste, and non edible feedstock, India is building a sustainable and decentralised fuel ecosystem that supports both environmental and economic objectives.
Sustainable Aviation Fuel is also emerging as a strategic priority for Indias clean energy transition. The Government of India has proposed an indicative blending target of 1 percent SAF by 2027, applicable initially to international flights, followed by a 2 percent blending target in 2028. These targets reflect Indias commitment to decarbonising international aviation and align with evolving global regulatory frameworks. Pilot scale SAF production is currently underway, with public sector and institutional collaborations working to establish commercial scale facilities using indigenous and sustainable feedstocks. Indian Oil Corporation, in partnership with CSIR Indian Institute of Petroleum, has successfully demonstrated SAF production from domestic resources. As global demand for SAF accelerates, India is well positioned to become a competitive supplier both for domestic consumption and international export markets.
Several second generation ethanol plants using agricultural residues are currently under construction across key states. Municipal solid waste and industrial byproducts are also being leveraged for fuel production, further integrating biofuels into Indias broader circular economy strategy. These efforts are aligned with national goals under Swachh Bharat Abhiyan, Doubling Farmers income, and the vision of industrial sustainability.
The Global Biofuels Alliance, launched during Indias G20 presidency, reinforces Indias role as a thought leader in the global bioenergy landscape. With participation from over 30 countries and institutions, the alliance aims to harmonise sustainability standards, facilitate cross border investment, and accelerate global adoption of biofuels. Indias leadership in this platform positions it not only as a technology and production hub but also as a key influencer of international clean energy policy.
Therefore, Indias biofuels sector represents a rare confluence of vision, viability, and value creation. Anchored in national development goals, global climate commitments, and investor aligned opportunity, this sector is poised to drive long term transformation. With the right mix of capital, strategic partnerships, and policy alignment, India is not only well positioned to meet its domestic energy transition goals but also to lead globally as a preferred destination for sustainable fuel production, innovation and export.
For forward looking investors, this is more than a sectoral opportunity. It is a front row seat to one of the most consequential energy transformations of the 21st century and a chance to co-create the blueprint for a Viksit Bharat and a greener planet.
Outlook
Indias biofuels sector stands at a moment of strategic consolidation and forward momentum. It is no longer defined by pilot-scale interventions or policy ambition alone, but by institutional readiness, industrial depth, and a shared national commitment to cleaner, self-reliant energy systems.
The progress over the past few years has laid a strong foundation. The ethanol blending programme has reached levels of maturity, underpinned by a clear roadmap, substantial capacity augmentation, and active private sector participation. Compressed Biogas, now backed by formal blending obligations, is gaining traction as a circular economy solution with relevance across energy, agriculture, and waste management. The advancement of Sustainable Aviation Fuel is a signal of Indias intent to engage not just in energy transition, but in shaping the next generation of global climate solutions.
What distinguishes this phase is the sectors alignment with broader national priorities energy security, rural value creation, carbon reduction, and industrial competitiveness. The ecosystem has evolved: supply chains are diversifying, production infrastructure is scaling, offtake agreements are becoming institutionalized, and regulatory frameworks are maturing in step with market needs.
Even in the absence of formal targets beyond 20 percent ethanol blending, the sectors preparedness is evident. The capacity to absorb higher mandates exists. The feedstock base is increasingly diversified. Technological pathways such as second-generation ethanol and Alcohol-to-Jet fuels are becoming commercially viable. This readiness is further reinforced by Indias ability to integrate domestic resource efficiency with global climate and trade imperatives.
Investment appetite is also deepening. The biofuels value chain is now seen as a credible, scalable, and strategic avenue for climate-aligned capital. Indias policy stability, combined with demand certainty and sustainability-linked opportunities, makes it a natural destination for long-term investment in green energy infrastructure.
At this stage of evolution, biofuels are not just a component of Indias alternative energy mix they are an essential building block of the countrys energy transition. They offer a rare intersection of economic utility, social impact, and environmental stewardship. For a country of Indias scale and complexity, this balance is not a luxury, but a necessity.
As a committed industry stakeholder, we recognise our responsibility in advancing this agenda. We are investing in new capacity, scaling innovation and building partnerships that enhance the credibility and impact of the sector both domestically and internationally.
Indias biofuels future is not a matter of potential it is a matter of execution. The path ahead calls for sustained leadership, collaborative governance and a relentless focus on delivery. If done right, this sector will not only transform Indias energy economy, but also shape a global model for inclusive and sustainable growth.
KEY GOVERNMENT POLICIES
Policies for First Generation (1G) Ethanol & Biodiesel
National Biofuels Policy - The National Biofuels Policy 2018 aims to reduce Indias fossil fuel dependence, promote cleaner energy, and ensure energy security. It targets 20% ethanol blending with petrol by 2025 and 5% biodiesel blending with diesel by 2030. The policy encourages diverse feedstocks, prioritizing non-food sources. The 2022 amendment expanded feedstocks to include agricultural residues, forestry residues, and industrial wastes, and added advanced biofuels like 2G ethanol and compressed biogas (CBG). Financial incentives include subsidies, tax reductions, viability gap funding, and interest subvention, with additional incentives to attract private investment and favorable loan terms.
Ethanol Blended Petrol ("EBP11) Programme -The EBP programme was launched in 2003, aiming to promote the use of environmentally friendly alternative fuels and reduce import dependency for energy requirements. Under the EBP program, the government undertook several measures like re-introducing administered price mechanisms, exploring alternate routes to ethanol production and differential pricing mechanism for ethanol products. The government also introduced several schemes to reduce the price of ethanol blended petrol like reduction in GST on ethanol for EBP and interest subvention scheme. Furthermore, the government has released long term procurement targets for ethanol.
In 2019, the targets were revised to selling 10% ethanol blended petrol by 2022 and 20% by 2030; however, the government achieved its 2022 stated targets and has taken several measures to prepone the existing target of 20% blending in 2030 to 2025. In addition to these efforts, the Government is also using taxes and duties to encourage ethanol usage and boost the market for ethanol. For instance, an additional basic excise duty of Rs.2 llitre is being levied on unblended petrol (not blended with ethanol or methanol) intended for retail sale with effect from November 1, 2022, showcasing the Governments commitment towards bringing ethanol to the forefront.
To increase indigenous production of ethanol, the Government since 2014 took multiple interventions including administered price mechanism, opening alternate route for ethanol production, amendment to Industries (Development and Regulation) Act, 1951 which legislates exclusive control of denatured ethanol by the Central Government, reduction in GST from 18% to 5%, notification of National Policy on Biofuels - 2018, increasing scope of raw material for ethanol procurement, interest subvention scheme for enhancement and augmentation of ethanol production capacity and extension of EBP Programme to whole of India except islands of Andaman Nicobar & Lakshadweep with effect from April 1,2019. (Source: CRISIL Report) It has been decided that the price of ethanol derived from damaged and surplus food grains has to be fixed by oil marketing companies ("OMCs").
Interest cost subsidy for setting up ethanol plants - Under the scheme for extending financial assistance to sugar mills for augmentation of ethanol production capacity, the Government of India extends soft loan to the mills for setting up new distilleries/ expansion and installation of incineration boilers or installation of any method as approved by central pollution control board for zero liquid discharge and interest cost subsidy on the loans to be extended by banks for five years including a one-year moratorium.
PLI Incentive - To increase the production of ethanol in the country and achieve the much-stated target of 20% blending by 2025, the Government has announced several schemes for the aligning industry, ultimately benefiting the ethanol production in the country. One of the incentives under the scheme is providing soft loans to sugar mills and a single-window mechanism for expedited regulatory clearance for building grain-based distilleries across the country.
Ethanol Interest Subvention Schemes have been introduced between 2018 and 2022, incentivizing entrepreneurs to establish new distilleries or expand existing ones. These schemes provide an interest subvention, which is borne by the Government of India of 6% or 50% of the interest charged by banks/financial institutions for five years, whichever is lower, accompanied by a one-year moratorium.
Under the New Industrial Policy 2025, Government of Karnataka has introduced a scheme where certain industries receive an incentive of 1.75% of their gross revenue for actively participating in and supporting the states economy and job creation initiatives. (Source: CRISIL Report) Under the Government of Karnatakas scheme, if a company has a topline of Rs.1,000 crore in a financial year, it would receive incentives benefiting it to the tune of Rs.17.5 crore.
Special incentives package - The Government of Karnataka has granted a special incentives package for us effective from May 2023, concerning our ethanol production plants, which have collectively been recognized as a Super Mega Enterprise under the Industrial Policy 2020-2025. The incentives include a five-year exemption or reimbursement of all kinds of applicable stamp duty and registration charges, in addition to other incentives in line with the New Industrial Policy 2020-2025.
Exemption of excise duty The Central Board of Indirect Taxes and Customs (CBIC), in July 2022, exempted the excise duty on 12% ethanol blended petrol and 15% ethanol blended petrol in order to support the ethanol production in the country.
Ethanol projects under priority sector lending Some State Governments have also included ethanol projects under priority sector lending which has encouraged banks to sanction loans for ethanol projects.
Under the New Industrial Policy 2020-2025, the government has also introduced the Production Linked Incentive (PLI) scheme for automotive & auto component industry, specifically for flex fuel engine (capable of running ethanol 85 (E85) fuel) manufacturers, providing them with tax incentives. This move is expected to accelerate introduction of Flex Fuel vehicles in India, thus, growing the demand for ethanol in the country.
To further enhance the biofuel roadmap of India, Madhya Pradesh and Rajasthan governments have come up with specific ethanol policies, providing incentive packages & subsidies of around Rs 1.5 per litre of ethanol produced for a period of 7-10 years.
Price setting and subsidy for Potash Derived from Molasses (PPM) PPM, a potassium rich fertilizer derived from ash in molasses-based distilleries, is a by-product of the sugar-based ethanol industry. The potash-rich ash can be processed to produce PDM having 14.5% potash content and can be used by farmers in the field as an alternative to MOP (Muriate of Potash with 60% potash content). The Central Government has facilitated a mutually agreed price of PDM at Rs.4263/ MT for sale by sugar mills to fertilizer companies for the current year. In addition, PDM Manufacturers can also claim subsidy at Rs.345/ Ton at present rates under Nutrients Based Subsidy Scheme (NBS) of Department of Fertilizers. The idea behind these efforts of the government is to facilitate long-term sale/ purchase agreement on PDM between sugar mills and fertilizer companies.
Interest cost subsidy for setting up ethanol plants Under the scheme for extending financial assistance to sugar mills for augmentation of ethanol production capacity, the government of India extends soft loan to the mills for setting up new distilleries/ expansion and installation of incineration boilers or installation of any method as approved by central pollution control board for zero liquid discharge. The government offers an interest subvention of 6% per annum or 50% of the rate of interest charged by banks, whichever is lower, for a period of five years.
Key Policies for Second (2G) Generation Ethanol
India is at the cusp of transforming to the 2nd Generation of Biofuel, due to recent government mandates and introduction of the policy "Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool fasal awashesh Nivaran) Yojana" ("PM JI-VAN Yojana") for funds providing an initial push to the 2G ethanol capacity in India and attract further investments in the sector. Under the scheme, financial support to twelve integrated 2G Bio-ethanol Projects with a total financial outlay of Rs. 1,969.5 crore for the period 2018-19 to 2023-24 has been provided. The PM JI-VAN Yojana initiative has been introduced, which establishes a maximum financial aid of Rs.150 crore for commercial projects and Rs.15 crore for demonstration projects, and aims to enhance the economic viability of projects and foster research and development in the realm of 2G ethanol production technologies.
Apart from the financial assistance granted through the PM JI-VAN Yojana, various measures have been implemented to encourage the growth of ethanol plants. These include introducing extra excise duty on non-blended fuels, ensuring a guaranteed offtake for 15 years to private stakeholders through Ethanol Purchase Agreements signed by OMCs, diversifying the feedstock for 2G ethanol production, establishing a distinct price for 2G ethanol, reducing the GST rate to 5% on ethanol for the EBP Programme, and more. To accelerate innovation in the biofuels sector and attract greater investment, the Union Cabinet, chaired by Prime Minister Shri Narendra Modi, approved the modified Pradhan Mantri JI-VAN Yojana in August 2024.
The revised scheme extends its implementation timeline by five years, up to FY 2028-29, and broadens its scope to include advanced biofuels derived from lignocellulosic feedstocks such as agricultural and forestry residues, industrial waste, syngas, and algae. It also brings "bolt-on" units and brownfield projects under its ambit, allowing experienced players to enhance viability and scale operations. To encourage innovation and feedstock diversification, the scheme will now prioritize proposals featuring novel technologies and emerging solutions.
By enabling value creation from agri-residues, curbing pollution, fostering rural employment, and strengthening Indias energy independence, the modified JI-VAN Yojana aligns with the nations broader objectives of sustainability and self-reliance. It also advances Indias net-zero vision for 2070 and reinforces the Make in India mission by promoting indigenous biofuel technology development. This renewed push underlines the Government of Indias commitment to building a future-ready, green energy ecosystem.
Policies for the CBG Sector:
Sustainable Alternative Towards Affordable Transportation scheme introduced by the Government of India in 2018 ("SATAT") - The SATAT initiatives ambitious target is to produce 15 million metric tonnes per annum ("MMTPA") of CBG and a remarkable 50 MMTPA of bio-manure. The scheme envisages setting up of 5,000 CBG plants for production of 15 MMTPA of CBG by 2025, with an envisaged initial outlay of Rs. 30,000 crore for setting up of 900 plants in the first phase. As of March 2023, oil and gas marketing companies participating in the scheme have been issued 4,090 Letter of Intent and 58 CBG plants have been commissioned. SATAT scheme invites individuals or corporations to set up CBG plants, produce and supply CBG to OMCs.
CBG Blending Obligation - In November 2023, the Government of India made it mandatory for the City Gas Distribution ("CGD") sector to blend CBG into the CNG (transport) and PNG (domestic) segments. This significant move aims to promote sustainable energy practices nationwide. Under the CBG Blending Obligation ("CBO"), CGD entities are required to mix CBG with natural gas, with the blending percentages gradually increasing over time. Initially starting as a voluntary effort until Fiscal 2025, the CBO mandates blend percentages of 1%, 3%, and 4% for Fiscal 2026,2027 and 2028, respectively, and by Fiscal 2029, this obligation rises to 5%. Furthermore, until the CGD network is fully operational across the country, CBG marketed separately by all CGD entities will also count towards meeting the blending obligation.
CBD-CGD Synchronisation Scheme - The Ministry of Petroleum and Natural Gas has issued policy guidelines dated April 9, 2021 and October 26, 2021 for synchronization of CBG produced by plants in CGD networks. (Source: CRISIL Report) GAIL has been mandated to operationalize the Synchro Scheme and supply biogas/CBG co-mingted with domestic gas at Uniform Base Price to all CGD entities for use in CNG (Transport) and PNG (Domestic) segments of CGD network. The term of CBG-CGD Synchro Scheme has been further extended by 10 years. In February 2023, in an effort to prevent the stacking of taxes on blended CNG, the Ministry of Finance granted an exemption from excise duty on the portion equivalent to the GST paid on CBG when mixed with CNG.
CBG initiatives have the potential to produce carbon credits via the Clean Development Mechanism established by the United Nations Framework Convention on Climate Change - these carbon credits can be marketed to organizations and governments seeking to neutralize their carbon emissions, offering an extra income stream for CBG projects.
CBG projects fall under Agriculture infrastructure as per RBI guidelines. Loans to agriculture infrastructure are being classified under priority sector lending which has encouraged banks to sanction loans for CBG projects.
Market Development Assistance - The Department of Fertilizers has introduced a Market Development Assistance ("MDA") scheme with an outlay of Rs. 1,451.82 crore for three years, from Fiscal 2024 to Fiscal 2026. Under this scheme, an MDA of Rs.1500/MT will be granted for the sale of FOM, liquid FOM, phosphate-rich organic manure produced at biogas/CBG plants under the GOBARdhan initiative.
Department of Agriculture, & Farmers Welfare: Agri-Infra Fund - The Department of Agriculture & Farmers Welfare has introduced a new Scheme under the National Agriculture Infra Financing Facility called Agriculture infrastructure Fund ("AiF"). The AIF offers financial assistance for investments in viable projects related to post-harvest management infrastructure and community farming assets. CBG is among the eligible projects under the community farming assets project. All loans obtained through this financing facility will benefit from a 3% per annum interest subvention, capped at a loan amount of Rs.2 crores. This subvention will be applicable for a maximum duration of 7 years.
Additionally, in 2023, India introduced the 2023 Carbon Credit Trading Scheme, encompassing both compliance and voluntary sectors. However, the compliance segment is scheduled to commence in 2025-26 and there is no set timeline for the launch of the voluntary carbon market. Nevertheless, it shows the intent towards sustainability. Under Indias revised carbon market scheme, obligated entities have the flexibility to purchase additional credits or sell surplus ones. Meanwhile, businesses can trade CCCs to offset their emissions. Such schemes will further boost green fuels and energies once they are brought into action.
Scheme for Development of Pipeline Infrastructure for Injection of Compressed Biogas (CBG) in City Gas Distribution (CGD) network - The Ministry of Petroleum and Natural Gas announced a financial outlay of ^994.50 crore during the period of FY 2023-24 and FY 2025-26 for creating CBG CGD grid connectivity for 100 CBG projects and create ecosystem for offtake of CBG with reduced logistic cost.
Waste to Energy Programme
The programme by Ministry of New and Renewable Energy supports setting up projects for generating Biogas, Bio-CNG/Enriched Biogas/Compressed Biogas, Power, or syngas from urban, industrial, and agricultural waste/residues. it provides Central Financial Assistance (CFA) to project developers and service charges to implementing/inspection agencies upon successful commissioning.
• Bio-CNG/Enriched Biogas/CBG: Rs.4.0 crore per 4,800 kg/day (new plants), Rs.3.0 crore per 4,800 kg/day (existing plants), max Rs.10 crore per project.
• Power (from Biogas): Rs.0.75 crore/MW (new), Rs.0.5 crore/MW (existing), max Rs.5 crore/project.
• Power (from bio & agro-industrial waste): Rs.0.4 crore/MW, max Rs.5 crore/project.
• Biomass Gasifier: Rs.2,500/kWe (dual fuel), Rs.15,000/kWe (100% gas engines), Rs.2 lakh per 300 kWth (thermal).
• CFA is 20% higher for plants in Special Category States/UTs or registered Gaushalas/Shelters.
• Service charges are provided at 1% of total CFA (minimum Rs.50,000) for implementing and inspection agencies.
Financsal Assistance to CBG Producers for Procurement of Biomass Aggregation Machinery
The Biomass Aggregation Machinery Scheme, administered by the Ministry of Petroleum & Natural Gas through the Centre for High Technology (CHT), provides financial support for CBG plants to procure agricultural residue collection and aggregation equipment. The aim is to ensure steady biomass supply for CBG production, reduce stubble burning, and improve feedstock logistics.
Financial Assistance: 50% of the cost of eligible machinery or Rs.90 lakh per set—whichever is lower—subject to a maximum of Rs.9 crore per project (on a pro-rata basis).
Eligibility: CBG plants (existing or under construction) with capacity >2 TPD using at least 50% biomass or 3,000 MT/year, registered on the GOBARdhan portal. Projects must have achieved minimum physical progress (25-50% depending on stage).
Eligible Machinery: Includes cutters, rakers, balers, tractors with attachments, trolleys, loaders, shredders, moisture meters, and related safety equipment.
Disbursement: Phased release—mobilization advance up to 10% (against bank guarantee), balance in installments based on progress milestones.
Scheme Duration: Applicable for FY 2023-24 to FY 2026-27, supporting the first 100 biomass-dependent CBG plants.
OPPORTUNITIES AND THREATS
SWOT Analysis
| STRENGTHS | WEAKNESS |
Abundance of Biomass: |
Seasonality: |
| India is endowed with abundant renewable energy resources, supporting local biofuel production, reducing the need for petroleum imports, and enhancing energy security with diverse, indigenous energy sources. | The seasonality of crops and feedstock causes supply fluctuations that disrupt production schedules in the ethanol and biofuels industry, leading to potential shortages or surpluses. This variability increases storage costs and price volatility, complicating cost management and planning for producers. |
Government Support: |
Access to Feedstock: |
| India has rapidly emerged as a major biofuel producer and consumer due to a series of coordinated government policies. This robust governmental backing has fueled industry growth, positioning India as a key player in the global biofuel market. | Access to feedstock is impacted by weather changes, geographical constraints, and competition with other industries, driving up prices and reducing availability. Logistical challenges in transporting feedstock from remote areas further impact the reliability and cost-effectiveness of supply. |
Rising energy demand: |
High Production Costs: |
| Indias rising energy demand presents a significant opportunity for the biofuel industry. As the country seeks sustainable and alternative energy sources to meet its growing needs, biofuels offer a viable solution. | The biofuel industry faces high production costs due to expensive raw materials and advanced conversion technologies. This can limit competitiveness and profitability, making it challenging for biofuels to compete with the lower costs of fossil fuels. |
Rural development opportunities: |
Technological Challenges: |
| The biofuel industry significantly boosts rural development by creating jobs and providing additional income for farmers through the use of agricultural waste. This not only strengthens the rural economy but also promotes sustainable agricultural practices, making it a vital component of Indias energy strategy. | Technological challenges in biofuel production and processing hinder efficiency and scalability. Significant investment in R&D is needed to improve conversion processes and reduce costs, but innovation is slow due to the high risks and expenses involved. |
Environmental Benefits: |
Infrastructure Limitations: |
| The biofuel industry reduces greenhouse gas emissions, lowers fossil fuel dependence, and promotes sustainable waste management, contributing to a cleaner environment and a smaller carbon footprint for India. | Limited infrastructure for biofuel distribution and storage poses significant challenges to widespread adoption and market growth. Existing networks are primarily designed for fossil fuels, requiring substantial investment to adapt, while specialized storage facilities for biofuels are scarce. |
Strong Research and Development Capabilities: |
Skilled Manpower: |
| India?s robust R&D infrastructure supports ongoing innovation, enhancing the biofuel ecosystems growth and sustainability. | A shortage of skilled manpower affects the ethanol and biofuels industry, which requires expertise in biotechnology, chemical engineering, and agricultural sciences. Attracting and retaining such professionals is challenging, leading to higher recruitment and training costs. |
Growing awareness and adoption of biofuels: |
|
| Increasing awareness and adoption of biofuels in India is driving demand and supporting industry growth. This shift towards sustainable energy solutions enhances market opportunities and contributes to a greener, more sustainable future. |
SWOT Analysis
| OPPORTUNITIES | THREATS |
Rising Energy Demand: The increasing energy demand in India presents significant opportunities for the biofuel industry. As the country seeks sustainable and alternative energy sources to meet its growing needs, biofuels offer a viable solution. |
Competition with Fossil Fuels: Biofuels face strong competition from cheaper and more established fossil fuels, which can limit market share and profitability. |
| Increase in targets of Ethanol Blended Petrol (EBP) Proaram: Goina forward, hiqhertarqets for ethanol blending in petrol will create a growing market for ethanol producers. | Food vs. Fuel Debate: The use of agricultural feedstocks for biofuel production can lead to conflicts with food supply, impacting public perception and policy support. |
| Transition to Flex-Fuel Vehicles: The shift towards flex fuel vehicles will open new markets for biofuels, supporting industry growth. | Climate Variability: Climate variability and extreme weather events can affect the availability and reliability of feedstocks, disrupting biofuel production. |
| The Diverse End-Use Applications: Biofuels can be used in various applications, from transportation to industrial processes, increasing their market potential. With the growth of these sectors, the demand for biofuels is poised to grow significantly. | Regulatory and Policy Changes: Uncertainty and changes in government regulations and policies can impact the biofuel industrys growth and stability. |
| Growing Alcoholic Beverages Market: The expanding market for alcoholic beverages boosts demand for ethanol, a key biofuel component creating more market opportunities for producers. | Technological Advancements in Electric Vehicles: The rapid advancement and adoption of electric vehicles pose a significant threat to the biofuel market by reducing demand for liquid fuels. |
| Increased adoption of ethanol in Industrial Applications: Greater use of ethanol in industrial applications drives demand and supports industry expansion. | Global Economic Instability: Economic instability can affect investment in the biofuel sector and disrupt global supply and demand dynamics. |
| Growing Sustainable Aviation Fuel Market: With the growth of the aviation sector and the need to move to sustainable aviation fuel as per the norms set globally to offset and reduce carbon footprint globally through international aviation, the market for Sustainable Aviation Fuel (SAF) is growing, providing new opportunities for biofuel producers. | Infrastructure Limitations: Insufficient infrastructure for biofuel production, distribution, and storage can hinder market expansion and accessibility. |
Technological Innovations for high value by-products: Innovations that create high-value by-products from biofuel production offer significant opportunities to enhance profitability and market appeal. Developing high-value products from by-products will create more opportunities to command premium prices, further boosting profit margins. |
|
Shift towards Sustainable Mobility: The global shift towards sustainable mobility will increase the demand for biofuels as a cleaner energy alternative, presenting numerous opportunities for the industry. V |
TruAlt Bioenergy stands at a pivotal juncture, leveraging its strengths to capitalize on burgeoning opportunities in the energy sector. The companys commitment to biofuels aligns seamlessly with the global shift towards greener energy solutions. With a robust focus on rural development and the vision of Atmanirbhar Bharat, TruAlt Bioenergy is well-positioned to contribute significantly to reducing crude imports and enhancing farmer incomes.
The strengths of TruAlt Bioenergy, including access to abundant feedstock, strong partnerships, and strategic market positioning, provide a solid foundation for growth. However, the company must remain vigilant to potential threats such as regulatory changes and market competition. By addressing these challenges and maximizing its opportunities, TruAlt Bioenergy can lead the charge in the biofuels sector, driving forward sustainable development and energy independence in India.
Company Overview
TruAlt Bioenergy Limited is one of Indias largest biofuel producers, strategically positioned as a leading and diversified player in the Indian bioenergy sector, with a primary focus on ethanol manufacturing. As of March 31, 2025, the Company operates five sugarcane juice/molasses-based distilleries, with an aggregate ethanol production capacity of 2,000 kilo litres per day (KLPD), making it the largest ethanol producer in India. The Company commands a market share of 7.0% in the sugarcane-based ethanol segment and 3.6% in the overall ethanol market for Fiscal 2025.
Unit / Location |
Installed Capacity* |
Fungible Integration by addition of Grains Capacity |
Feedstock |
| TBL Unit 1 | 700 KLPD | 550 KLPD by August 2025 | Dual Feed Stock (550 KLPD dual feed and 150 KLPD Sugarcane Juice / Syrup/ Molasses) |
| TBL Unit 2 | 500 KLPD | 450 KLPD by August 2025 | Dual Feed Stock (450 KLPD dual feed and 50 KLPD Sugarcane Juice / Syrup/ Molasses) |
| TBL Unit 3 | 400 KLPD | - | 400 KLPD Sugarcane Juice / Syrup/ Molasses |
| TBL Unit 4 | 200 KLPD | 300 KLPD by August 2025 | Dual Feedstock (200 KLPD) |
| TBL Unit 5 | 200 KLPD | -- | Sugarcane Juice / Syrup / Molasses (200 KLPD) |
Total |
2,000 KLPD |
1,300 KLPD |
To expand its presence in the CBG segment, Leafiniti has entered into a non-binding term sheet with Maharatna PSU - GAIL (India) Limited to jointly set up CBG plants across India. Furthermore, the Company has signed a Memorandum of Understanding (MoU) with global trading and investment company Mitsui & Co. (Asia Pacific) Pte. Ltd. and Japanese gas company Osaka Gas Co., Ltd. to establish a joint venture aimed at developing CBG plants across various regions in India.
In line with its strategic roadmap, the Company has also entered into a non-binding term sheet dated with leading integrated trading company Sumitomo Corporation Asia & Oceania Pte. Ltd. to collaborate on multiple bioenergy projects. The initial phase includes the development of CBG plants followed by potential joint ventures in ethanol and Sustainable Aviation Fuel (SAF) production.
These Partnerships collectively aim to advance innovation and capacity across a range of bioenergy verticals, including:
| Biogas and Compressed Biogas (CBG) | First-and Second Generation Ethanol | Sustainable Aviation Fuel (SAF) | Sugar-derived Biochemicals | Carbon Credit & Decarbonization Initiatives |
Through these strategic alliances, the Company envisions establishing up to 24 CBG plants, significantly scaling its national footprint in alternative fuels and circular economy solutions.
Strategic Initiatives
Over the past three fiscal years, TruAlt Bioenergy has significantly enhanced its financial performance while expanding its operational and technological capabilities. The Company is progressing toward becoming an integrated biofuels platform, with key forward-looking initiatives including:
¦ Second-Generation (2G) Ethanol Production
The Company is embarking on a pivotal expansion into Second-Generation (2G) ethanol production, aligning with its broader strategy to advance sustainable technologies and maximize the value of agro-industrial by-products. As part of this initiative, the Company plans to utilize approximately 800,000 metric tonnes of bagasse - a lignocellulosic residue generated during sugarcane processing to produce an estimated 60 million litres (6 crore litres) of ethanol annually.
To enable the deployment of this advanced technology, the Company has executed a Technology Transfer Agreement with Praj Industries Limited, a global leader in integrated bioenergy solutions. This partnership will facilitate the establishment of a technologically advanced 2G ethanol facility, designed to convert biomass into high-purity ethanol using commercially proven, environmentally sustainable processes.
Beyond supporting domestic ethanol blending targets under the Government of Indias Ethanol Blended Petrol (EBP) programme, this initiative is expected to open significant export opportunities. Given its lower carbon intensity and advanced processing standards, 2G ethanol is increasingly recognized as a premium product in global markets particularly in countries with stringent decarbonization mandates and a growing demand for sustainable transportation fuels.
This forward-looking venture positions the Company to not only diversify its product portfolio and strengthen its technological capabilities, but also to establish itself as a globally competitive supplier of next-generation biofuels, contributing to both national energy security and international climate commitments.
¦ Sustainable Aviation Fuel (SAF) Manufacturing
As part of our strategy to move up the biofuels value chain and tap into high-growth global markets, the Company is actively advancing its entry into Sustainable Aviation Fuel (SAF) production. To this end, we have signed a Memorandum of Understanding (MoU) with a U.S.-based leader in sustainable fuel technologies, to explore the development of a state-of-the-art facility for SAF manufacturing.
The proposed facility is expected to have an annual production capacity of approximately 100 million litres (10 crore litres) of SAF, using ethanol as the primary feedstock. This project has the potential to position TruAlt Bioenergy among the worlds largest producers of SAF derived from ethanol, a milestone that would place India at the forefront of global sustainable aviation initiatives.
In alignment with international and domestic policy developments, we are scaling this initiative to meet emerging compliance requirements. From 2027 onwards, all international flights are expected to be subject to offsetting obligations under the mandatory phase of the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). Additionally, the Government of India has announced an indicative SAF blending target of 1% by 2027.
¦ Manufacturing of Mevalonolactone (MVL) and Allied Biochemicals
The Company is evaluating opportunities to diversify into the production of Mevalonolactone (MVL), a high-value biochemical used as a precursor in the manufacture of elastomers, specialty fuels, and Sustainable Aviation Fuel (SAF) molecules. To advance this initiative, the Company has entered into a Memorandum of Understanding (MoU) with Visolis Inc., USA, to explore potential technology collaboration.
As part of this evaluation, feasibility studies are being conducted to assess the implementation of dual-purpose fermentation technology capable of producing both ethanol and MVL. This initiative reflects the Companys strategic focus on leveraging its existing infrastructure to expand into high-potential, value-added bio-based products.
¦ Establishment of Biofuel Dispensing Stations
As part of its forward integration strategy and entry into the direct-to-consumer energy segment, TruAlt Bioenergy has initiated the rollout of its proprietary biofuel dispensing stations, with initial outlets established in Mudhol, Jamkhandi, Badami, and Kerakalmatti, all located in the Bagalkot district of Karnataka.
These stations are designed to offer a comprehensive range of sustainable mobility solutions, including motor spirit (petrol), high-speed diesel, E85 and E93 ethanol-blended fuels, bio-CNG, as well as electric vehicle (EV) infrastructure, such as charging stations and battery swapping facilities. Each outlet is also equipped with a non-fuel retail division that provides fast-moving consumer goods (FMCG) and automotive products, ensuring a seamless and customer-centric energy retail experience.
Aligned with the Government of Indias push for non-fossil fuel transportation and leveraging its integrated ethanol and CBG production capabilities, TruAlt Bioenergy plans to establish 100 biofuel dispensing stations over the next five fiscal years. Through this initiative, the Company aims to capitalize on the anticipated adoption of flex-fuel vehicles and the rising demand for higher ethanol-blend fuels, while creating a differentiated and accessible clean energy retail footprint.
Standalone Financial Information:
Our revenue from operations increased to Rs.1,88,011.66 lakhs in Fiscal 2025 from Rs.1,21,707.96 lakhs in Fiscal 2024 by 54% during the year.
Our total income increased to Rs. 1,94,070.60 lakhs in Fiscal 2025 from Rs.1,27,342.93 lakhs in Fiscal 2024 by 52% during the year.
EBITDA amounting to Rs.29,719.38 lakhs in Fiscal 2025 from Rs.18,774.81 lakhs in Fiscal 2024 mainly due to reduction in manufacturing expense to 1.45% in Fiscal 2025 from 3.01% in Fiscal 2024 and power and fuel cost to 4.92% in Fiscal 2025 from 7.05% in Fiscal 2024 as a % of Revenue.
Finance costs was Rs. 14,103.64 lakhs in Fiscal 2025 which comprised interest on Compulsorily Convertible Preference Shares (CCPS) of Rs.282.47 lakhs. In Fiscal 2024 it was Rs.14,101.02 lakhs which comprised interest on Compulsorily Convertible Preference Shares (CCPS) of Rs.3,132.86 lakhs. The interest on CCPS was notional in nature and not payable to the subscribers as per Ind AS 109. Subsequently, all the CCPS got converted into equity shares in May 2024.
Our depreciation and amortisation expenses stood at Rs.6,459.57 lakhs in Fiscal 2025 and Rs.5,578.30 lakhs in Fiscal 2024, comprising depreciation of Rs.5,232.93 lakhs and amortization of intangible assets and right of use assets of Rs.1,226.64 lakhs and depreciation of Rs.4,472.38 lakhs and amortization of intangible assets and right of use assets of Rs. 1,105.92 lakhs respectively due to increase in gross block by Rs.45,786.59 lakhs.
Net Worth increased to Rs.76,753.22 lakhs in Fiscal 2025 from Rs.58,729.59 lakhs in Fiscal 2024.
**Net Worth includes CCPS of Rs. 31,813.25lakhs for Fiscal 2024 considered as a debt instrument in the restated financials
Total Assets increased to Rs.2,97,776.01 lakhs in Fiscal 2025 from Rs.2,36,317.02 lakhs in Fiscal 2024.
Net Working Capital stood at Rs. 17,604.90 lakhs in Fiscal 2025 from Rs.5,627.48 lakhs in Fiscal 2024 mainly due to increase in inventories of Rs.4,868.85 lakhs, increase in trade receivables of Rs.4,087.61 lakhs, increase in trade payables Rs.33,061.84 lakhs, decrease in other financial liabilities of Rs.5,846.70 lakhs, increase in other current liabilities of Rs.44.29 lakhs, increase in other financial assets of n,105.23 lakhs and increase in other assets of Rs. 18,544.39 lakhs.
Investment in Subsidiary
The Board of Directors of the Company at its meeting held on September 18, 2023 has approved the purchase of 72,19,494 equity shares of Leafiniti Bioenergy Private Limited. (LBPL1) from its shareholders. On October 4, 2023, the Company had invested Rs.866.34 lakhs constituting 51.22% of the paid-up share capital of LBPL, resulting in gain of control as per Ind AS 103 - Business combinations, thereby making LBPL a subsidiary of the Company.
In a subsequent meeting on November 6, 2023, the Board approved an additional investment of Rs.63.94 lakhs for purchase of 5,32,829 equity shares constituting 3.78% of shareholding in LBPL, which was executed on December 27, 2023.
Furthermore, the Company has invested Rs.761.24 lakhs, to acquire the remaining 45% of LBPLs paid-up share capital, thereby making LBPL a wholly-owned subsidiary as on 24th February, 2024.
Cash-flow
Cashflow from Operating Activities
Net cash flows generated from operating activities was 3:33,550.23 lakhs in Fiscal 2025. in Fiscal 2025, profit before tax was 315,215.11 lakhs. Primary adjustments consisted of depreciation and amortization expense of 36,459.57 lakhs and finance cost of 314,103.64 lakhs.
Cashflow from investing Activities
Net cash flow used in investing activities in Fiscal 2025 was 325,699.47 lakhs, primarily due to payments for purchase of property, plant and equipment including capital work in progress of 325,938.85 lakhs, investment in bank deposits of 3107.13 lakhs and loan given to subsidiary of 3250 lakhs.
Cashflow from Financing Activities
Net cash flow from financing activities in Fiscal 2025 was 35,193.82 lakhs, primarily on account of proceeds from long-term loans (net) of 316,496.12 lakhs and on account of current borrowings of 32,486.58 lakhs which was partially offset by interest paid of 313,676.68 lakhs.
Financial Ratios
Interest Coverage Ratio:
Interest coverage ratio has improved to 2.04 in Fiscal 2025 from 1.60 in Fiscal 2024.
Debt Service Coverage Ratio (DSCR):
DSCR has improved to 1.21 in Fiscal 2025 from 1.10 in Fiscal 2024.
Return on Capital Employed (ROCE):
ROCE has increased to 14.51% in Fiscal 2025 from 11.26% in Fiscal 2024.
Return on Equity (ROE):
ROE has increased to 18.69% in Fiscal 2025 from 11.23% in Fiscal 2024.
Debt/Equity Ratio:
Debt/Equity has improved to 1.44 in Fiscal 2025 from 1.63 in Fiscal 2024.
Debt/EBITDA Ratio:
Debt/ EBITDA has improved to 5.16 in Fiscal 2025 from 7.13 in Fiscal 2024.
Net Working Capital Cover:
Net WC ratio has improved to 1.20 in Fiscal 2025 from 1.10 in Fiscal 2024.
Our revenue from operations increased to Rs.190,772.40 lakhs in Fiscal 2025 from Rs. 1,22,340.47 in Fiscal 2024 by 56% during the year.
Our total income increased to Rs.1,96,852.78 lakhs in Fiscal 2025 from Rs.1,28,018.77 in Fiscal 2024 by 54% during the year.
EBITDA amounting to Rs.30,914.37 lakhs in Fiscal 2025 increase from Rs.18,808.51 lakhs in Fiscal 2024 mainly due to reduction in mainly due to reduction in manufacturing expense to 1.46% in Fiscal 2025 from 3.00% in Fiscal 2024 and power and fuel cost to 5.04% in Fiscal 2025 from 7.11% in Fiscal 2024 as a % of Revenue.
Finance costs was Rs.14,361.10 lakhs in Fiscal 2025 which comprised interest on Compulsorily Convertible Preference Shares (CCPS) of Rs.282.47 lakhs. In Fiscal 2024 it was Rs.14,307.61 lakhs which comprised interest on Compulsorily Convertible Preference Shares (CCPS) of Rs.3,132.86 lakhs. The interest on CCPS was notional in nature and not payable to the subscribers as per Ind AS 109. Subsequently, all the CCPS were converted into equity shares in May 2024.
Our depreciation and amortisation expenses stood at Rs.6,459.57 lakhs in Fiscal 2025 and Rs.5,578.30 lakhs in Fiscal 2024, comprising depreciation of Rs.5,232.93 lakhs and amortization of intangible assets and right of use assets of Rs. 1,226.64 lakhs and depreciation of Rs.4,472.38 lakhs and amortization of intangible assets and right of use assets of Rs.1,105.92 lakhs respectively due to increase in gross block by Rs.45,786.59 lakhs.
Total Cash Accrual for the operations increased to Rs.21,353.22 in Fiscal 2025 from Rs.12,005.44 lakhs in Fiscal 2024 by 78%. The cash earning per share is Rs.21.80 in Fiscal 2025 and was Rs.19.66 in Fiscal 2024.
Net Worth increased to Rs.76,900.68 lakhs in Fiscal 2025 from Rs.58,274.69 lakhs in Fiscal 2024.
** Networth includes CCPS of Rs. 31,813.25lakhs for Fiscal 2024 considered as a debt instrument in the restated financials
Total Assets increased to Rs.3,02,973.09 lakhs in Fiscal 2025 from Rs.2,41,908.08 lakhs in Fiscal 2024.
Net Working Capital stood at Rs.16,780.42 lakhs in Fiscal 2025 and was Rs.4,719.70 lakhs in Fiscal 2024 mainly due to increase in inventories of Rs.5,072.62 lakhs, increase in trade receivables of Rs.4,107.96 lakhs, increase in trade payables Rs.33,208.48 lakhs, decrease in other financial liabilities of Rs.6,191.74 lakhs, increase in other current liabilities of Rs.3.29 lakhs, increase in other financial assets of Rs.1,109.67 lakhs and increase in other assets of Rs. 13,985.41 lakhs.
Cash-flow
Cashflow from Operating Activities
Net cash flows generated from operating activities was lakhs in Fiscal 2025. in Fiscal 2025, profit before tax was 7 15,944.28lakhs. Primary adjustments consisted of depreciation and amortization expense of 76,689.37 lakhs and finance cost of 7 14,361.10 lakhs.
Cashflow from investing Activities
Net cash flow used in investing activities in Fiscal 2025 was 724,252.43 lakhs, primarily due to payments for purchase of property, plant and equipment including capital work in progress of 725,960.1 5 lakhs, investment in bank deposits of 7188.02 lakhs.
Cashflow from Financing Activities
Net cash flow from financing activities in Fiscal 2025 was 73,972.09 lakhs, primarily on account of repayment of loans of 714,525.52 lakhs and on account of finance cost paid of 713,877.51 lakhs.
Financial Ratios
Interest Coverage Ratio:
Interest coverage ratio has improved to 2.06 in Fiscal 2025 from 1.56 in Fiscal 2024.
Debt Service Coverage Ratio (DSCR):
DSCR has improved to 1.22 in Fiscal 2025 from 1.08 in Fiscal 2024.
Return on Capital Employed (ROCE):
ROCE has increased to 14.86% in Fiscal 2025 from 11.09% in Fiscal 2024.
Return on Equity (ROE):
ROE has increased to 19.44% in Fiscal 2025 from 10.83% in Fiscal 2024.
Debt/Equity Ratio:
Debt/Equity has improved to 1.45 in Fiscal 2025 from 1.68 in Fiscal 2024.
Debt/EBITDA Ratio:
Debt/ EBITDA has improved to 5.01 in Fiscal 2025 from 7.27 in Fiscal 2024.
Net Working Capital Cover:
Net WC ratio has improved to 1.19 in Fiscal 2025 from 1.08 in Fiscal 2024.
Internal control systems and their adequacy
TruAlt Bioenergy has implemented a comprehensive internal control framework aligned with encompassing control environment, risk assessment, control activities, information and communication, and ongoing monitoring. This system supports the Companys integrated operations across ethanol, bioenergy, and allied businesses, ensuring accuracy in financial reporting, operational efficiency, regulatory compliance and asset protection across its facilities.
The internal control structure is anchored in accountability and transparency, supported by well-defined policies, Standard Operating Procedures (SOPs), authorization hierarchies, and routine assessments conducted at plant, functional, and corporate levels.
¦ Financial Controls
TruAlt Bioenergy has instituted robust financial controls across all critical business processes including procurement, revenue recognition, working capital management and capital expenditure. A maker-checker-approver mechanism ensures transactional integrity and SAP-based automation enhances traceability and compliance.
Quarterly and annual financial statements are prepared in strict adherence to Indian Accounting Standards (Ind AS) and reviewed or audited by statutory auditors. These controls collectively support reliability in financial disclosures and adherence to all applicable statutory and regulatory frameworks.
¦ Operational Controls
Each vertical ethanol, CBG and allied operations follows a tailored control matrix governing procurement, production efficiency, logistics and quality management. Real-time tracking systems monitor key parameters and output.
¦ Compliance and Risk Management Controls
The Company maintains a centralized compliance tracking system that oversees regulatory filings, environmental permissions, ethanol blending mandates and industry-specific directives from central and state authorities.
The Risk Management Committee, chaired by senior management, conducts regular reviews of key risks, audit findings, mitigation strategies and emerging threats. These insights are escalated to the Audit Committee, ensuring that oversight remains timely and effective.
¦ IT and Cybersecurity Controls
Recognizing the importance of digital resilience, the Company has implemented multi-layered cybersecurity measures, including firewalls, endpoint protection and encryption standards. Role-based access controls and real-time system monitoring protect critical assets and data integrity.
Routine cybersecurity audits, disaster recovery drills, and penetration testing are conducted to validate system robustness and incident response readiness. These safeguards are essential in todays data-driven operating environment.
¦ Internal Audit
An independent internal audit firm has been appointed to conduct risk-based audits in line with a Board-approved annual audit plan. These audits assess both the design and operational effectiveness of controls across business functions and processes.
During FY 2024-25, BDO conducted a comprehensive review of the operative effectiveness of Internal Financial Controls (IFC). The assessment included detailed testing across processes, summary results, and managements action plans for addressing observations. The findings were reviewed by the Audit Committee and presented to the Board of Directors. Open communication is maintained with both internal and statutory auditors to ensure transparency and continual enhancement of the internal control environment.
Human Resources
At TruAlt Bioenergy, we recognize that our employees are the cornerstone of our long-term success. Beyond being part of the organization, they represent our most valuable asset. The Company remains firmly committed to investing in its human capital through structured skill development, knowledge enhancement, and leadership advancement initiatives. This commitment underscores our belief that the growth and success of our employees directly contribute to the performance and sustainability of the business.
To ensure our workforce remains agile and aligned with evolving industry dynamics and technological advancements, we have institutionalized comprehensive learning and development programs. During the year, a broad spectrum of training interventions was delivered across areas such as technical proficiency, behavioural competencies, business excellence, general and advanced management, leadership development, workplace safety, and adherence to corporate values and the Code of Conduct.
By fostering a culture of continuous learning and innovation, the Company empowers its employees to realize their full potential while driving organizational excellence. As of 31st March 2025, TruAlt Bioenergys total employee strength stood at 714.
Risk Management Approach / Risks and Concerns
The Company continues to adopt a forward-looking and integrated risk management strategy, aimed at safeguarding its long-term sustainability and operational resilience. Building on the foundation laid in previous years, our framework has evolved to encompass dynamic risk identification, real-time assessment and strategic mitigation aligned with enterprise objectives.
This year, our focus has expanded further into predictive analytics, scenario planning and early-warning indicators, enabling proactive risk management across business verticals. The Company has strengthened its governance structures and refined standard operating procedures to integrate both macroeconomic risks and granular operational exposures. This includes risks emerging from geopolitical shifts, climate impact, supply chain vulnerabilities or any rapid technological changes.
With cross-functional involvement, our risk management function is now embedded into every level of decision-making from Board-level oversight to frontline execution ensuring responsiveness and agility. Periodic audits, digital dashboards and robust internal controls enhance our visibility into emerging risks while enabling timely course correction.
We remain committed to cultivating a risk-intelligent culture that prioritizes transparency, accountability, and continuous improvement, thereby equipping the organization to navigate volatility and seize strategic opportunities with confidence.
| Risk | Mitigation Plan |
| Feedstock Availability | To ensure a consistent and uninterrupted supply of key raw materials, the Company has secured long-term supply agreements with MRN Chamundi Canepower and Biorefineries Private Limited - a Promoter Group entity along with MRN Bhima Sugar and Power Private Limited and MRN Canepower and Biorefineries Private Limited. These agreements facilitate reliable access to inputs such as bagasse, sugar syrup and molasses for ethanol production, while maintaining operational flexibility by not mandating any minimum purchase commitments. |
| Additionally, to enhance feedstock flexibility and optimize production economics, the Company is adopting fungible dual-feed technologies, enabling seamless switching between different input streams based on availability and market dynamics. | |
| Regulatory Clampdown | The Company has made substantial investments in plant and machinery aimed at environmental protection, specifically to mitigate pollutants and greenhouse gas emissions. We have implemented zero discharge facilities across our units to treat all liquid effluents, ensuring no discharge into the environment. |
| Additionally, we have adopted a rigorous process of recycling and reusing process water to minimize freshwater withdrawal. Effluent treatment plants have been strategically established at our distillery units to further reduce fresh water usage and minimize ecological impact. Our commitment extends to utilizing spent wash from the distillation process for CBG production, contributing to resource efficiency. | |
| Furthermore, each of our units is equipped with cogeneration units featuring boilers and turbines, which generate steam and power for our own consumption, thereby reducing our reliance on external power sources. | |
| Change in Government Policies | To mitigate risks arising from changes in government policies, the Company follows a proactive and multi-pronged strategy. We continuously monitor the evolving regulatory environment to anticipate and assess potential policy shifts that may impact our operations. Active engagement with industry associations and participation in advocacy forums enables us to constructively contribute to policy dialogue and safeguard our strategic interests. |
| Our legal and compliance teams play a pivotal role in ensuring accurate interpretation and timely implementation of regulatory changes. In parallel, the Company develops robust scenario planning and contingency frameworks, enabling swift operational adjustments in response to new policy developments. | |
| By embedding flexibility into our operating model and fostering transparency with stakeholders, we are well-positioned to navigate regulatory uncertainties. Through strategic foresight and long-term planning, theCompany remainsresilient and adaptive in a dynamic policy landscape. | |
| Climate-related Risks | The Company adopts a proactive approach to managing climate-related risks, recognizing their potential to materially impact operations, supply chains, and long-term value. Through detailed resilience assessments, we identify climate vulnerabilities and implement targeted adaptation strategies designed to ensure business continuity under varied environmental scenarios. |
| Sustainable resource management forms a core pillar of our operational strategy, helping reduce input dependencies and exposure to regulatory or climate-related disruptions. These initiatives not only enhance environmental performance but also improve cost efficiencies and risk-adjusted returns. | |
| To further safeguard stakeholder interests, the Company has established contingency frameworks to address disruptions stemming from extreme weather events, resource scarcity, and changing climate patterns. These measures reinforce our resilience and agility, ensuring we remain future-ready in a rapidly evolving climate and regulatory landscape ultimately supporting sustainable growth and long-term shareholder value. | |
| Technological Obsolescence Risk | The Companys sustained investments in advanced plant and machinery continue to drive operational efficiency, technological relevance, and long-term performance. We follow a structured modernization strategy that includes periodic upgrades, systematic replacements, and rigorous preventive maintenance schedules to ensure optimal asset utilization and minimal downtime. |
| Strategic capital expenditure is carefully deployed to support continuous improvement and operational excellence. In parallel, comprehensive training and upskilling programs equip our workforce to manage new technologies effectively and implement cost-optimized processes across the value chain. This integrated approach combining technology, maintenance, and human capital strengthens the Companys competitiveness, resilience, and ability to deliver consistent value to stakeholders. | |
| Technology failures and Security Risks | The Company maintains a resilient and secure IT infrastructure designed to support operational efficiency, data integrity and business continuity. Comprehensive data backup protocols and disaster recovery systems are in place to ensure minimal disruption and rapid restoration in the event of system failures or data loss. |
| Robust cybersecurity measures, including multi-layered access controls and continuous monitoring, safeguard critical systems and sensitive information. Access is strictly limited to authorized personnel reinforcing data security and compliance across the organization. This proactive approach to digital risk management strengthens business resilience and enhances stakeholder confidence in an increasingly technology-driven environment. | |
| Financial Risks | The Company adopts a disciplined and comprehensive approach to managing financial risk, with a strong emphasis on credit exposure. Before extending credit, we conduct thorough assessments of each customers creditworthiness and assign limits accordingly. These are subject to ongoing monitoring to ensure compliance and early detection of potential risks. |
| A significant portion of our ethanol sales is made to public sector Oil Marketing Companies (OMCs), which substantially reduces counterparty risk and ensures predictable cash flows. Our receivables management system is both rigorous and responsive, enabling us to track collections closely—typically ensuring resolution within a 12-month period. Notably, the Company has not encountered any material defaults to date. | |
| Our broader financial asset portfolio including trade receivables, loans, cash equivalents, and deposits is managed under a conservative and well-diversified framework. Given that trade receivables represent the most significant area of potential exposure, we have established robust policies, internal controls, and monitoring mechanisms to mitigate risk effectively and preserve financial stability. | |
| Human Resource Risk | The Company is deeply committed to attracting, developing, and retaining high-caliber talent by cultivating a workplace environment that prioritizes both professional advancement and personal well-being. We offer competitive compensation, comprehensive benefits, and well- defined career development pathways to foster a motivated and future-ready workforce. |
| Understanding the critical importance of work-life balance, we have instituted supportive policies and practices that empower employees to effectively manage their professional obligations alongside personal priorities. Our inclusive and flexible work culture is designed to enhance employee engagement, promote long-term productivity, and support holistic well-being. | |
| Moreover, the Company has established robust contingency protocols and workplace safety measures to protect the health, safety, and continuity of our teams during emergencies or unforeseen disruptions. This integrated approach reflects our unwavering commitment to building a resilient, empowered, and high-performing organization. |
Cautionary Statement
The statement made in this section includes the Companys objectives, projections, expectations and estimates which may constitute "forward-looking statements" as defined by applicable securities laws and regulations. Forward-looking statements are based on certain assumptions and expectations regarding future events. However, the Company cannot guarantee that these assumptions and expectations are accurate or will be realised. Actual results may materially differ from those expressed or implied in the statements due to external factors beyond the Companys control. The Company assumes no obligation to publicly update or revise any forward-looking statements based on subsequent developments, information or events.
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