The Indian sugar industry has witnessed tumultuous times in the past two years. However, with the decline in the
domestic sugar surplus, we believe the fundamentals of the sugar industry will be significantly altered. Going
forward, we anticipate that surging domestic prices coupled with favourable global prices will result in positive
earnings for mills. This would lead to brighter prospects for the industry, as a whole. Surging sugar prices and
higher contribution from by-products will result in 149.1% QoQ growth in earnings for Balrampur Chini and 14.6%
QoQ growth in earning for Shree Renuka Sugars. However, the depreciation in the rupee remains a cause for
concern for Bajaj Hindustan due to its foreign currency convertible bonds (FCCB) of Rs 570 crore. With higher
realisations from rectified spirits, revenues from by-products will increase and, thereby, enhance operating margin.

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