Dwarikesh Sugar Profit Rises 37% to Rs. 44.3 Cr in Q4; Total Revenue surged by 116% in FY20
Dwarikesh sugar has best sugar recoveries in UP, which makes it lowest cost producers in the industry. Its total income surged 116.32 per cent to Rs 463.21 crore, compared with Rs 214.09 crore a year ago
By: Sugar Times |11 June, 2020 | 11:58 AM
Dwarikesh Sugar Industries on Wednesday reported a 36.84 per cent rise in profit after tax (PAT) to Rs 44.27 crore during the fourth quarter ended March 31.It reported strong sales & earnings growth in Q4FY20 led by higher monthly sales quota & sugar exports during the quarter.
Net profit grew 37% to Rs. 44.3 crore mainly due to tax reversals with reassessment of deferred tax liability after the change in Income tax rate earlier this year.
The company reported revenues of Rs. 461.8 crore which is more than double that of the corresponding quarter largely on the back of higher domestic monthly sale quota & sugar exports during the quarter.
Domestic quota for the Q4 was 63000 tonnes & initial export quota was 78000 tonnes, of which 26000 tonnes were sold in Q3.
In that respect, our estimates suggest sugar sales volume of 1.5 lakh tonnes during the quarter. Sugar prices were also marginally up (3-5%) during the quarter.
The impact of Covid-19 on the sugar industry would be minimal with 1.0-1.5 million tonnes reduction in demand.
However, export incentives, introduction of MSP & ethanol policy of government have changed the fundamentals of the industry.
We believe export incentives would continue even in Next crushing season and there is possibility of further increase in MSP of sugar. We believe sugar companies would continue to remain profitable.
It has also increased its distillery capacity last year, which would result in higher revenues from the segment FY21 onwards. We remain positive on sugar stocks in general & Dwarikesh Sugar, in particular.
“The country expects to produce 27 million tonne of sugar during the sugar year 2019-20. Sugar price continues to be around the minimum support price (MSP) level of Rs 3,100 per quintal. We continue our efforts towards improving operating efficiencies and control costs,” Dwarikesh Sugar Industries Managing Director Vijay S Banka said.