Red hue to sugar firms' finances

Triggered by a sharp decline in sugar prices, large mills in this business, barring Shree Renuka Sugars (SRS), have reported a deepening of losses for the quarter ended March. Those making a profit have posted a steep fall in this.

Industry leader Bajaj Hindusthan reported a quarterly loss of Rs 539 crore for the quarter, on a turnover of Rs 1,181 crore. In the corresponding quarter last year, it had a net loss of Rs 424 crore on net sales at Rs 1,325 crore. The country's largest producer has 14 plants with aggregated cane crushing capacity of 136,000 tonnes a day, and alcohol distillation capacity of 800 kl a day.

"Realisation from sugar bottomed out to Rs 24.50 a kg during the quarter, Rs 7-8 a kg lower than the cost of production. Being a volume-based company, we have to incur losses, considering around 80 per cent of income comes from sugar sales," said a spokesperson.

Similarly, Triveni Engineering had a net loss at Rs 86 crore for the quarter as against one of nearly Rs 60 crore in the same quarter last year. Net sales fell marginally to Rs 444 crore from Rs 455 crore.

Oudh Sugar Mills and Dalmia Bharat posted a sharp decline in net profit. Kesar Enterprise, Gayatri Sugars, and Rajshree Sugars went from profit to loss in the quarter.

Kolkata-based Balrampur Chini reported a 60 per cent slump in net profit to Rs 76 crore for the quarter as compared to Rs 190 crore in the same period last year.