Conference Call with Balrampur Chini Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen to the full earnings transcript.
Key Highlights from Management
I am glad to share that BCML has delivered excellent performance during the quarter and year ended 31st March 2020 despite the challenging environment prevailing in the sector. The sugar segment delivered a healthy performance on the back of higher volumes and steady realizations.
The distillery segment delivered robust performance on account of higher volumes and better realizations. Our 160 KLPD distillery facility at Gularia commenced operations from 12th January 2020 which is expected to drive the segment’s performance in the coming sugar season. Sugar production in the country in the current season is expected to be ~27 million tonnes due to lower cane acreage and yield especially in Maharashtra and Karnataka.
Domestic consumption inspite of initial impact of Covid-19 is expected to be ~25 million tonnes. Next years production is expected to be ~30-31 million tonnes, so the sugar inventory would continue to remain high. Going forward continuance of all existing policies is required, which have yielded desired results for all stakeholders.
All the manufacturing facilities of the Company continued to remain fully operational even during the lock-down period. With prudent capital allocation, strong cash flows, improving macros, we are confident of creating sustainable value for all stakeholders going forward.
Company has successfully commissioned 160 KLPD Gularia distillery on 12th January 2020 which is fully Zero Liquid Discharge compliant. During Q4 ithas diverted 327.01 lakh quintals of cane for producing B-heavy molasses, representing 38.3% of total cane of the current season till 31st March 2020.
Long term and Short Term ratings of the firm stands at AA and A1+ respectively as assigned by ICRA and CRISIL. As on 31st March 2020 long term debt of the company stands at Rs 44,589.3 lakh which includes SDF Loan of Rs 533.40 lakh @ 4% interest, and balance are term loans availed under State Government and Central Government which carries interest at subsidized rates. Repayment obligation towards term loan is very nominal going forward.
We announced the creation of buffer stock of 4.0 million tonnes for a period of 1 year with effect from 1st August, 2019 in order to help the sugar industry from demand -supply mismatch. The carrying cost on the same is to be reimbursed by Central Government.
Fixed Fair & Remunerative Price (FRP) for sugar season 2019-20 at Rs 275 per quintal of sugarcane linked to a basic recovery of 10%, the same as last year. We also announced Maximum Admissible Export Quota of 6 million tonnes in order to address the demand-supply mismatch.
Further in order to facilitate the exports thereby improving the liquidity position of sugar mills and enable them to clear cane dues notified the scheme for providing assistance @ Rs. 10,448/M.T. to sugar mills for expenses on marketing costs including handling, upgrading and other process costs and cost of international and internal transport and freight charges.