Ladies and gentlemen, good day and welcome to the E.I.D. Parry India Q1 FY2026 Earnings Conference Call hosted by DAM Capital Advisors Ltd. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sanjay Manial. Thank you. Over to you, sir.
Hello everyone, and a warm welcome on behalf of DAM Capital Advisors Ltd to the Q1 FY2026 Earnings Call of E.I.D. Parry India Ltd. We thank E.I.D. Parry India's management for giving us an opportunity to host this call. On the call today, we have Mr. Muthiah Murugappan, Full-Time Director, and other senior management team E.I.D. Parry . I hand over the call to the management for opening remarks, followed by a question-and-answer session. Thank you, and over to you, sir.
Thanks, Sanjay. Very good morning to everyone. It gives me great pleasure to be a part of this analyst call and to share some updates on both the global as well as the Indian scenario and explain the Q1 performance of the company. You will also note that our Quarterly Investor Presentation has been uploaded online post our Board meeting yesterday. I'll start with the global scenario. The global sugar market is projected to remain in mild surplus through the sugar year 2025-2026, primarily due to increased production in Brazil, India, and Thailand. Favorable weather has supported higher output in India and Thailand, while Brazil continues to crush aggressively with a sugar mix of above 52% despite dry conditions affecting cane quality. However, risks to Brazilian output persist due to lower cane yields, declining APR, and weak sugar prices, which may prompt a shift toward ethanol production.
According to Zarniko, the market is still oversupplied by approximately 2 million metric tons of raw sugar and 1.1 million metric tons of white sugar in 2025, with an additional 1.2 million metric tons of white sugar surplus expected in the first half of 2026. This is given raw sugar prices down from $0.215 per pound in February to about $0.16 per pound at present. The white premium remains uncertain, with refiners needing $100 per metric ton to remain viable, suggesting a necessary range of $80 - $100 per metric ton to incentivize supplies. EU sugar output is expected to decline, while demand from key destination markets such as China, Indonesia, and Bangladesh has softened. With prices trading near ethanol parity, any further shift in Brazil's mix towards ethanol could help stabilize the market. Strategic policy decisions and production responses will be key to rebalancing global fundamentals.
I'll now move to the Indian scenario. As of mid-July, India's sugar production stands at 25.7 million metric tons, with 14 mills still operational. Early season yields were impacted by adverse weather, but improved recoveries on the back half of the season have supported output. Pre-monsoon rainfall, which largely occurs during the months of March to May 2025, was 42% above normal, significantly affecting the in-growing states positively. Maharashtra, Karnataka, and Tamil Nadu all recorded surplus across major districts. Domestic consumption is projected to be 27.9 million metric tons, with 0.6 million metric tons expected to be exported from the 1 million ton quota which was provided. 3.4 million metric tons is the expected diversion towards ethanol. Estimated closing stocks are in the range of 5.5 million metric tons, roughly 2.5 million metric tons of demand.
Most states have seen a decline in sugar output, with Maharashtra and Uttar Pradesh showing the largest drops in absolute terms. Statewise, Uttar Pradesh yields with 9.24 million metric tons, followed by Maharashtra at 8.09 million metric tons, Karnataka at 4.75 million metric tons, and Tamil Nadu at 0.5 million metric tons as of mid-July. Key factors to monitor going forward will really be how the cane crop pans out in the upcoming sugar season. The good monsoon spells are encouraging on the stocks. Also, developments on the ethanol blending program, particularly on ethanol pricing, as well as outcomes of India-U.S. trade talks and any bearings this might have on the ethanol and sugar sector, will also need to be monitored. I now hand over to our CFO, Mr. Venkatesh Guru, to take you through the operating performance of the company in Q1.
Thank you, Mithu. Good morning to all participants. It's a great pleasure to be part of the analyst call and to share the key information of the operational and financial performance of the company. I would like to share with you the key operating parameters of each segment. As far as the sugar operations are concerned, we have crushed the Tamil Nadu plants, and about 63 days, average 64 days crushed during the quarter one. I would like to share the quantitative results at the end. The Q1, we crushed about 211,000 metric tons when compared with the corresponding quarter of the previous year, which was 193,000 metric tons. Recoveries are under pressure because the recoveries for the current quarter are 8.02%, against 8.6% of the corresponding quarter of the previous year.
We produced sugar about 17,000 metric tons during this quarter and against 16,000 metric tons of the corresponding quarter of the previous year. Cane cost is about INR 3,844 per metric ton, against INR 3,491 per metric ton of the corresponding quarter of the previous year. This is mainly on account of the FRP impact, which was declared by the central government from the INR 3,150 to the INR 3,400 per metric ton. As far as the sugar sales volume is concerned, sugar sales volume for the current quarter is 84,000 metric tons, which is completely driven by the domestic sale. There is no export quota available to us. Whatever the quota was available, we already exported. The corresponding quarter of the previous year was 105,000 metric tons. The previous corresponding quarter also was completely domestic. That was about 605,000 metric tons.
The reduction is mainly on account of the lower release order quota, which is given by the DFPD. As far as the sugar selling prices are concerned, average selling price overall is INR 41.99, against the previous year's corresponding quarter of the year at INR 38.60. We are carrying about 120,000 metric tons of sugar as of June 25, and we are valued at an average of INR 37. As far as the segment revenue is concerned, sugar revenue for the current quarter is about INR 347 crore, against INR 404 crore of the corresponding quarter of the previous year, registering a decline of about 14% on a lower release order.
The consumer product group delivered a turnover of about INR 192 crores for the current quarter, registering a decline of 11% over the corresponding quarter of the previous year of INR 216 crores, mainly on account of a lower release quota for the sweetener category, partially offset by steady performance in the staples segment, which is registering a growth of 33% over the corresponding quarter of the previous year. As far as the cogen is concerned, the power generated during quarter one is about 221 lakh units, against the 307 lakh units in the corresponding quarter of the previous year. We have exported about 122 lakh units, against the 170 lakh units in the corresponding quarter of the previous year. The average power tariff for the current quarter is INR 3.67 per unit, against INR 4.23 per unit in the corresponding quarter of the previous year.
Revenue for the quarter is about INR 7.53 crores, against the previous year INR 11.94 crores in the corresponding quarter of the previous year. As far as the distillery segment is concerned, we have sold about 413 lakh L, against the previous corresponding quarter 390 lakh L, of which ENA is 153 lakh L, and ethanol was 260 lakh L. As far as the realization is concerned, it is INR 62.59 per liter, against the corresponding quarter of the previous year's realization of INR 64.31. Revenue is up to INR 296 crores compared to the INR 263 crores during the corresponding quarter of the previous year. As far as the nutraceuticals segment is concerned, as far as the Indian operation is concerned, we have done about INR 5.94 crores per tonnage against INR 8.41 crores in the corresponding quarter of the previous year.
At the consolidated level, nutraceuticals business tonnage is about INR 27 crores, against INR 59 crores in the corresponding quarter of the previous year. As far as the refinery operations are concerned, the operations revenue for this quarter is INR 9.8 crores, against INR 1,213 crores for the corresponding previous year's quarter. As far as the PBT is concerned, good story because we made a positive PBT of INR 67 lakhs, against the loss of INR 6.79 crores. Sugar production is about 2.25 lakh metric tons, against 1.6 lakh metric tons in the previous year quarter. Refined sugar sales are about 2.02 lakh metric tons, against the previous year's quarter of 2.23 lakh metric tons. As far as the loss is concerned, there is no long-term loss, which is repaid to the parent company about INR 200 crores.
As far as the short-term loss, external loss is concerned, it is INR 461 crore. Agonizing the Q1 of 2024-2025 is about INR 220 crore. These are the operations of the Q1. Now, the floor is open for the questions.
Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets when asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Rajesh Majumdar from B&K Securities. Please go ahead.
Yeah, good morning everyone. Thanks for a very detailed presentation this time that you've uploaded the presentation. I had a few questions. The first question was on the consumer product group, the sweet nut category. How do we read into the volumes of the consumer part of this business, as in the entire sale is quota-driven? If we are not able to grow our sugar volumes over the next few years, will the consumer part as a proportion of the sweet nut category be theoretically 100% or what percent, or do you have to strengthen raw sugar as well? How do we read this? That was my first question.
Yeah, so Rajesh, hi, good morning. Yes, it is quota-driven. We will have to do a couple of things on the sweetness side. Of course, focus on sales of value-added product from the sweetness segment, launch new products, expand the product portfolio that is on the annual as well. We'll also make tactical calls to take in more quota. We also have to now feed an institutional market wherein we have to sort of balance overall pricing as well. We'll take some of those tactical calls going forward. Those are opportunities for sales to grow in the sweet nut part of the CPG segment. There's also, I would say, the last point I would like to make here is, you could also have traded volumes wherein which you would obviously, based on the right quality control, have other mills packed for you. That's something which would also be being explored. It needs to be done at the right economics. There are opportunities to take this up. We'll be tactical about it.
Theoretically, we can move up to whatever percent of the overall quota depends on the part of the business.
Yeah, if they move up, it's about the tactical choices that we make. I mean, one theme of Q1 is to obviously we've got distribution, which we're expanding, and we wanted to, within our current quota, take the attractive business. We've actually jettisoned some of that very low-value business wherein discounting factors are high, so on and so forth. We make some conscious calls in Q1.
My second question was on the refinery segment. While we've seen we have gone down some step down subsidiary in the GOE, which is into exports, we are also committing more capital in terms of the business. What's really going on here in terms of the refinery business? I would like to know.
Yeah, I can come in on this, Rajesh. I think the, as you know, the refinery business, there is a lot of debt, and this capital is driven in for debt reduction in order to strengthen the operations of the refinery. I think that's why we've had these infusions.
What about the closure of the step down, sir, which is into exports? What is it indicating?
We didn't find that, you know, of any strategic significance to the refinery operations. I think we are happy with the standalone operations here in Karkhynada, and we'd like to remain focused on that.
Okay. We've seen a sharp increase in the short-term debt in a quarter where normally in Q1 and Q2, we see the short-term debt coming down, and then it probably goes up when the sugar crushing starts in Q3 and Q4. In Q1, we've seen a sharp increase in the short-term debt. That is a bit alarming. Any reason why that has happened and how should we read that going forward?
Venkateshwarlu, you can cover that.
Rajesh, if you look at the short-term debt, this is not only relating to the crushing and also we are starting putting the molasses from the other sales because we're keeping in view the increase in the distillery capacities in the last year. We need a molasses over and above what we are going to crush in. Those are all the molasses we have done a forward contract and some of the precepts we already sold the molasses. That is one of the reasons. The second reason also, you have to look at our consumer product group business is going up and our reachables also is slightly going up in line with the turnover and in line with the industry standards. Thereby, our working capital requirement is going up. Thereby, correspondingly, your short-term debt is going up.
That means that overall short-term debt for the end of the year will be even higher than the actual pricing, at least.
For our legs it will be the same levels, Rajesh, because if you look at it today, you are looking at about INR 1,100 crore or something. Even at the year end also, we'll be looking at the same because if you look at it, most of the crushing will get closed by February or somewhere. The F&T payment and all the things will be already we are given advances. That will be offset against the advances what we have given.
Thanks for that. Let's see the last question. This is from Muthiah. Sir, we have a 36% stake in Coromandel and the Coromandel stock is now at 52-week high. Can we contemplate some stake sale because technically it can come down to 51% and still retain our majority holding to reduce our debt? Yeah, thank you.
Rajesh, I think there's, you know, we're really focused on the standalone business here. I think these are broader conversations which are more sort of Board and Group level, and I think we should stay focused on the standalone operations here.
Thank you.
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question is from the line of Vaishnavi Gurung from Craving Alpha Wealth Fund. Please go ahead.
Good morning, sir. Thank you for taking my question. Just one question from my side.
Yes, Vaishnavi, can you speak a little louder?
Hello, is it better?
Yes, much better.
Yeah, my question was regarding the revenue from Nutrient and Allied Business. The revenue is significantly up compared to last June quarter. I just wanted to know any specific reason for that?
No, the Nutra Business revenue is actually lower.
Muthiah, I think she's asking about the Coromandel International Limited law firmly.
Okay. Yes, sir. Yeah, I think that, yeah, the consolidated is we consolidate Coromandel International Limited. We can't comment on their results. I think their board and earnings call has already concluded. They've had a good first quarter, but you may want to look up publicly available data to go over their results.
Okay, my second question was if there is any capacity expansion plans we have?
Not at present. We've just finished up last year our ethanol CapEx. CapEx cycle is largely concluded. It's a phase of consolidation right now.
Okay, that's it from my side.
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question is from the line of Sanjay Manyal from DAM Capital . Please go ahead.
Hi, sir. I have just a few questions specifically regarding the good monsoon and what kind of a crushing is expected in Karnataka and some of the southern states. What is our plan over here to increase the crushing in the next season? What is the expectation on that side?
Monsoon has been good in the states of Karnataka and Maharashtra also. Overall, the industry is looking for a good crop this year. Our internal data also is showing a robust situation. We would expect marginal positive upside in Karnataka crushing this year as compared to last year. Tamil Nadu will be largely neutral. There is a lot of action we are doing in terms of rebuilding Tamil Nadu, but being a green crop, it might take one or two cycles. Overall, we have a positive outlook on crushing for the year.
Great. On a peak utilization of our distillery capacity, what kind of ethanol or ethanol/ENA can you sell? I mean, sir, what would be a sort of optimum revenue from our distillery segment?
Our overall capacity is about 180 million liters across all our facilities. The choice of the product mix varies depending on the margins we will make. We actively look at the product portfolio and keep changing it as the situation develops depending on the pricing in the market. Obviously, ethanol pricing is relatively stable given the government additions. The ENA is an option we keep evaluating. It's a revenue mix management approach. The full capacity is about 180 million L is what we'll be able to do in a year. The capacity utilization will be about 90 %- 95% provided there are no outliers with cheaper from a policy perspective.
Given the fact that now there is a lot of talk about increasing the ethanol blending from 20% to 25% or 27%, that's what we hear in a lot of discussion from the government side. Is there any plan again to sort of further increase our capacity over here? What are the discussions with the government happening on this ethanol blending part? Is there any roadmap for that which they are deciding?
Obviously, if they have decided it would be in the public domain, but we would presume the government is seized of the situation given the news that we read. The direction the government has been taking on the ethanol blending program is highly appreciable. They seem to be steering the industry and the usage of ethanol in the right direction. We remain positive about the government's approach on the issue. I may not be able to comment on what is the internal discussions that the government is currently doing because we have not had visibility on that.
Oh, Sanjay, just to add to Aashik's point on capacity expansion, we don't have any plans for expansion. I think we'll have to wait to see how policy pans out. If at all there's something we might consider, it might be, you know, we have one dual feed distillery. We might consider repurposing one or two of our other distilleries to, you know, operate on both grain as well as molasses-based feedstock. This is perhaps something we might consider. This is again subject to, you know, obtaining policy clarity and subject to sort of further internal evaluation.
Right. Just on this part, how are the margins in the separate grain part as well as in the which is better feedstock as of now? Also, there has not been any increase on the ethanol prices from the last two years. Is there any clarity on that, at least on the sugarcane-based feedstocks, if there is a possibility of any ethanol price hike?
On margins, obviously, we would not want to come in between the feedstocks, but right now both maize and molasses are profitable. In terms of what was your second question? I'm sorry.
About the ethanol price hike, it has not taken place in the last two years. Is there again any discussion on that or any possibility of?
Yeah, there is a lot of representation we've been doing to the government on ethanol pricing. We would actually look forward to some action on that front. It's concerning for us that the last few years we have not had a price increase. The FRP of cane, which is our feedstock, keeps increasing year -on -year. That should take care of the farmers and rightly so. We would look forward to some positive news on the ethanol pricing, but that rests with the government.
Right, sir. Right, sir. That's it from my side. Sir, thank you. Thank you very much.
Thank you. A reminder to all participants to press star and one to ask a question. Ladies and gentlemen, let's wait for a moment while the question queue assembles. The next question is from the line of Ritwik Sheth from One Up Financial. Please go ahead.
Hi, good morning, sir. Sir, just one question from my end on the consumer product division. If you can throw some light on the strategy for the consumer product division going forward, we've built a decent base in the last four to six quarters. How to look at the sweetener category you mentioned earlier and first staples category in the next three years? If you can just throw some strategy on that.
Yeah, good morning, Ritwik. This is Balaji. I head the Consumer Product Business. In terms of the non-staples part of the business, we will continue to stay focused on driving distribution and increasing our brand EQP through that. In terms of sweetener, the focus is largely on the value-added browns category where we are seeing a potential opportunity to grow. Most of the expansion and growth will come in largely on the browns category for the sweetener. For the non-sweetener, it will be the continued focus on distribution and brand building for the next few quarters. There is some work happening on the development of new products which will come in into the page spacing. As of now, those are all rudimentary and developmental in nature, and we will come back to you as and when we are ready with those.
Mr. Ritwik?
Yeah, I'm.
Mr. Ritvik, can you be a little louder? We can't hear you very well.
Yeah, is it better?
Yes, much better.
Yeah, much better.
Yeah, yeah. On the distribution part, I believe we are around 2 lakh currently. In the next three years, what kind of distribution piece are we targeting? Are we looking to add more SKUs in the non-staples category?
As part of the growth strategy, we would be growing and expanding the distribution. We cannot put a number to it at this point in time, but we will definitely be focusing on numerical distribution, growing, and expanding products. In terms of SKUs, all those will come in with the addition of new SKUs when you're launching new products and in existing products. We will be coming up with SKUs more from a consumer perspective as and when there is a need which arises. The plans are put to grow in this district.
Okay. Safe to assume that sweetener category will be quota-driven going forward and you mentioned will be focusing on the higher value added, which is the browns category, right?
Yes, I think Mr. Muthiah Murugappan answered this question earlier. The quota is going to be a limiting factor on the sweetener sales, but we have our ways and the means of living around on this. One is by focusing on the browns category, which are not driven by the quotas so much. The second is that there is always an opportunity to buy in branch sugar, which is something that we will consider as we go forward when we feel that the quotas are restricting us in terms of our growth.
Over a three-year period, sir, would you like to give any aspirations? We are currently around INR 800 crore, INR 900 crore on an annual basis with brand or staples category combined. What would be a reasonable growth assumption for the next years? Would you have anything on this?
We won't have a number at this point in time, but I think we will be growing pretty aggressively in this category. Our expansion plans will include consolidating ourselves largely in the modern trade e-commerce and the general trade channels.
Got it. Okay, sir. All the questions. Thank you.
Thank you.
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question is from the line of Vaishnavi Gurung from Craving Alpha Wealth Fund. Please go ahead.
Hi, sir. My question is on the future outlook. How do we see our position for it? In 2013, do we plan to be more inclined towards agri or energy sector?
Vaishnavi, thanks for your question. I think the focus on the biofuels and bioenergy space will continue. Of course, it's ethanol and it's a consolidation phase right now. We'll have to see how policy pans out. There's also seemingly an opportunity in sustainable aviation fuel, which is being spoken about, but it's very, very early days. It's an opportunity which is being spoken about using this ecosystem. We'll have to really wait and watch as to how the policy framework pans out. One area of focus will be this space. The other area of focus, of course, is the consumer product group, which we've spoken about just in today's discussions as well. That is a business which will really take a separate path to the biofuel and bioenergy business. I think these are the two areas of focus of the company going forward.
Thank you, sir.
Thank you. A reminder to all participants, you may press star and one to ask a question. Let's wait for a moment while the question queue assembles. As there are no further questions from the participants, I now hand the conference over to the management for closing comments.
Thank you. Thank you all for logging into our Q1 Earnings Call today. We wish you the best and hope to see you at the next quarter earnings call. Thank you and all the best.
On behalf of DAM Capital Advisors Ltd, that concludes this conference. Thank you for joining us, and you may now disconnect your line.