Balrampur Chini Mills Ltd (BALRAMCHIN) Q2 FY23 Earnings Concall Transcript

Balrampur Chini Mills Ltd (NSE:BALRAMCHIN) Q2 2023 Earnings Conference Call dated Nov. 10, 2022

Corporate Participants:

Anup Pujari — Investor Relations

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Pramod Patwari — Chief Financial Officer

Avantika Saraogi — Business Lead

Analysts:

Lokesh Maru — Nippon India Mutual — Analyst

Shailesh Kanani — Centrum Broking — Analyst

Nishant Sharma — Edelweiss Wealth — Analyst

Richard DeSouza — SBI Mutual Fund — Analyst

Achal Lohade — JM Financial — Analyst

Nitin Awasthi — Credit Equities — Analyst

Anupam Goswami — B&K. Securities — Analyst

Nikhil Gada — Abacus Asset Management — Analyst

Dixit Mittal — LIC Mutual Fund — Analyst

Charles Kanani — Centrum Broking — Analyst

Presentation:

Operator

Ladies and gentlemen, good day, and welcome to Balrampur Chini Mills Limited Earnings Conference Call. [Operator Instructions]

I now hand the conference over to Mr. Anup Pujari from CDR India. Thank you, and over to you, sir.

Anup Pujari — Investor Relations

Thank you. Good afternoon, everyone, and thank you for joining us on Balrampur Mills Q2 and H1 FY 2021 Results Conference Call. We have with us today Mr. Vivek Saudi, Chairman and Managing Director; Ms. Avanti Saroki Business Lead; and Mr. Promos Patwari, Chief Financial Officer of the company. We will initiate the call with opening remarks from the management, following which we have the forum open for a question-and-answer session. Before we begin, I would like to point out that some statements made in today’s call may be forward-looking in nature, and a disclaimer to this effect has been insured in the results presentation shared with you earlier.

I would now like to hand Mr. Saraogi to make his opening remarks.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Good afternoon, everyone, and thank you for joining us on Balrampu’s Q2 FY 2020 Earnings Conference Call. I trust you have all had the opportunity to go through our results presentation providing details of our operation operation and financial performance. I will initiate the call with an update on the current developments in the true sector, followed by our company’s key highlights for the period under review. According to small estimates, India is expected to produce 6.5 million tons of sugar after accounting for a diversion of 4.5 million tonnes. So our more visibility on this probably would be available after a month where Millham all got into full swing and we get the first evidence of the yield of the retina.

The growth is likely to be on account of higher rates in the sugarcane in the country given our consumption of $28 million and inventory of $6 million, we remain in a surplus situation. So if — so it is expected that we would need to export around $8 million, the season to ensure stability prices while safeguarding the availability for sugar in the domestic market. Pragmatic export policies have been followed by the government in the past, which are insured sugar prices remained a innovative. So in a welcome move, the government has already allowed an export of 6 million tonnes, and the industry is hopeful that this should get further extended as the season progresses and we have more clarity on the production.

So assume the production is not 33.5% and it’s 35.5%, the government would probably recut the export from six million to — moving to the ethanol sector. As most of you are aware, the government has increased the procurement price of ethanol for the SNL supply year 2020 to 2023. This should provide impetus to the country’s plan to achieve 12% blending of a big petro this year. As the third largest importer of oil and consumer in the world, India is clearly making efforts to double the ethanol lending program to 20% from the current level of 10% by 2025, 2026. Maybe it could happen a year earlier. On the business front, the company reported subdued results during the quarter to lower chain availability and lower recovery witnessed during the season 2021/2022.

This impacted the sugar division division’s performance in this nonproductive quarter. While we witnessed some unseasonal range we put at the impact is expected to be marginal as the drop was already had a changed again a certain level of maturity. So there will be some delay in starting a few mills by five to seven days. However, KNAPP for us in the current year is estimated to be 15% to 20% higher than last year in the range of INR10.25 crores to INR1.5 crores against INR8.8 against 8.8 Kuntal last year. We will get rather better clarity on this within a month as I indicated, both at the company level and at the country level.

This estimated level of gain will enable us to deliver a healthier operational and financial performance in the next year, point to better availability not only to make sugar but for the byproducts as well. Coming to our district business, our capex plan for the distillery segment is not scheduled and will significantly augment our capacity to 2,500 by November 22, resulting in the total ethanol distillation of capacity of INR35 crore liters annually, including INR5 crores from grain. This includes our cutting-edge district project in Megaport, which should be one of its kind in the country. This would work on juice BAV grains as and when whatever feedstock is provided.

To conclude, BCML is always a spike for optimal investments in its operations as well as creating value for the shareholders. To that extent, we are pleased that the Board of Directors has approved the sixth consecutive buyback program of equity shares of 4.4 40-month collections.

Pramod Patwari — Chief Financial Officer

The maximum indicate…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Maximum price of 3%. This — I would now like to hand the floor over to Pramod to take the call for Prama.

Pramod Patwari — Chief Financial Officer

Thank you, and good day, everyone. We can stay away move into the Q&A session as the detailed presentation has already been shared. Thank you.

Questions and Answers:

Operator

[Operator Instructions]. The first question is from the line of Lokesh Maru from Nippon India Mutual. Please go ahead.

Lokesh Maru — Nippon India Mutual — Analyst

Hi, thanks for the opportunity. Sir, I have just one question. After Q4, it is quite evident that if we have 15%, 20% higher cane, the next season is going to be quite upbeat. My question is only on the next quarter, which is Q3, given that the inventory valuation that you have taken for sugar at 35 inventory at 10.9 lakh quintals compared to 2018 before. And again, our inventory on alcohol side, ethanol side.

So how would you portray Q3 as in would the pain from Q1 or the loss from Q1 continue in Q3 and then Q4 is actually going to be really good? Or just for Q3, how do you see Q3 as such?

Pramod Patwari — Chief Financial Officer

Q4 will always be this quarter in terms of the seasonality. Now as far as the Q3 does, we have mentioned in the presentation as well, we got an export quota of 1.9 lakh 98 lakh tons. Out of that, 1.4 lesson has already been contracted for physical export. And we have sold our quota of 56,000 tonnes. Some portion of gain will approve in quarter three.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. And the crushing begins in quarter three, four days late. So that’s not a big deal. So I don’t think we give a quarter-to-quarter forward-looking statement. But yes, quarter three will not look like this at all.

Lokesh Maru — Nippon India Mutual — Analyst

Sure, sir. Got that, thank you so much and all the best…

Operator

The next question is from the line of Shailesh Kanani from Centrum Broking. Please go ahead.

Shailesh Kanani — Centrum Broking — Analyst

Yup [Indecipherable] Thanks for the opportunity. Sir, a couple of questions. One, on the sugar export front, what we have contracted, would be shipping out in the third quarter or the fourth quarter? How that you and what will be the bifurcation between Roche Sugar and refined sugar in Nana?

Pramod Patwari — Chief Financial Officer

Shailesh, we cannot give the exact quantity which will be shipped in the third quarter or fourth quarter. But our ear beta absolutely as possible.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

But shipment would — some part would happen…

Pramod Patwari — Chief Financial Officer

Yes, to part will definitely happen in the third quarter also. So out of 1.4 lakh tons, INR35,000 is our and the rest is…

Shailesh Kanani — Centrum Broking — Analyst

Out of 14, 35,000…

Pramod Patwari — Chief Financial Officer

At 1.05 is fit…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Right. So in this 25%, 7, right?

Shailesh Kanani — Centrum Broking — Analyst

Okay. Fair enough. But this should be shipped by the financial year in that is March 23, right?

Pramod Patwari — Chief Financial Officer

Large extent.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Is 90% plus go 90 percentiles.

Pramod Patwari — Chief Financial Officer

Okay. Only more quantity can still over in…

Shailesh Kanani — Centrum Broking — Analyst

Okay. Fair enough. Sir, second point on the distal front, we have seen a decline of volume front as well on the atonal business. So can you shed some light on that? And also, a Mesa plant is it’s operational? Are we planning to run for the next couple of months on grain given the avbility of oasis be less and inventories also live. So can you just highlight something on the disti front?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So this delivery gets a feedstock from sugar cane. So sugarcane is less, molasses is less, the still the volume will be less, right? — here now — yes. So in sugar business will also begin — our days are just around the corner. And obviously, as and when the distantly starts, we will intimate the exchange. So you will hear with that together. So sugar season in commencing of digitally probably a very little portion of time could be done on grain to just test out the plant and then you switch to sugar in Maizapur thereafter once the season closes, you can go full on in ran. That is the basic program.

Shailesh Kanani — Centrum Broking — Analyst

Okay. And just to give some numbers, Medal be running for, say, four days in this quarter for quarter three.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So I repeat myself. As and when we are able to — as and when we commission Mazaud, we have to inform the exchange. So it’s uncertain to sort of mat announcement…

Shailesh Kanani — Centrum Broking — Analyst

Sure, sure. Okay, sir. Sir, a couple of more questions. Sir, Health Krashin started in any of our plants as of now or any contribution you can share today…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

We are beginning flashing today. right.

Shailesh Kanani — Centrum Broking — Analyst

And any time in growth as…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Sorry.

Shailesh Kanani — Centrum Broking — Analyst

Any time line for the remaining plan?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So progressively from like a 10, 15, then 18 like that, plants will begin and probably everything should begin down the 1st December.

Shailesh Kanani — Centrum Broking — Analyst

Fair enough. Okay, sir. Sir, last question from my side. Sir, what would be the vision from the management side from both perspective on the long term, not only from, say, two years down the line when, when our new causes are onstream and in general, how would you vision for Rapid to be, say, three years, five years after line? What is the vision for the company on the management side?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So we continue to explore related businesses and be sort of refuted and light in terms of our balance sheet for any good opportunity of acquisition. Having said that, we will not only be waiting for acquisition. We would be looking at other projects, should they make commercial sense and should be board be convinced management in the board, you will hear about it. But right now, it’s on the drawing board stage. It’s a little ahead. Everything is being affected the internal…

Shailesh Kanani — Centrum Broking — Analyst

So actually, if I can just explain that one. Actually, I was thinking more from derisking our business model or the way we have kind of little bit deals by enhancing our capacity on the distant. Are we taking something on something like a little long term, but are we thinking on pivotal line from one segment is the two other segments.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

And double… Currently, with INR1,050 crores distillation, 1500D distillation, we will be able to handle INR11,5crores to INR12 crores winter of gain, which we hope to get next year itself. In the process, one would keep revisiting and seeing if there is scope for more distill ties for more expansion and therefore, internal debottlenecking, if some can be expanded and it can go further and some distillation needs to be added for that.

So today, the distillation business, which you are asking for, we already would have the distillation capacity in the current year to cross INR11.5 crore winters against which we are expecting INR10.5 crores until this year, which is 18% higher than last year’s 888…

Shailesh Kanani — Centrum Broking — Analyst

Fair enough, sir. Thanks also I’ll join the queue.

Operator

The next question is from the line of Nishant Sharma from Edelweiss Wealth. Please go ahead

Nishant Sharma — Edelweiss Wealth — Analyst

Am I audible…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes.

Nishant Sharma — Edelweiss Wealth — Analyst

Thank you. Thanks for the question, thanks for the opportunity. Sir, two questions from previous participants just to reconfirm, on the distri side, you said whenever it will start, we first start with the grain post which basis the sugar season starts, so we’ll switch to sugar. And once the sugar season gets soon, will again get back to be. Am I correct on this, sir?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Absolutely correct.

Nishant Sharma — Edelweiss Wealth — Analyst

Sir, then how we would be switching, I mean, is there a time lag which would be required for switching from grain to sugar and it’s absolutely in a day or to — I mean, how that transition takes place…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

A day or two in a day.

Nishant Sharma — Edelweiss Wealth — Analyst

Okay. So it’s nothing age and we will be able to losing because like for Q3, it’s already 45 days are over. And so I’m just trying to understand that we won’t be able — we won’t be losing out much in terms of the production day.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Absolutely — absolutely not. Sugar, juice will take predominance over anything else. Having said that, we — as you understood and your initial remarks on the call were absolutely correct.

Nishant Sharma — Edelweiss Wealth — Analyst

Okay. Second, in terms of the export, again, a little bit of clarification here that out of whatever 1.4 lakh tonnes that we got quota. This is out of the entire quota. This is just for the time, I mean, we may get more allotment on a quota going forward?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

As and when the 60 lakh to 6 million tonne enhances on the currency level, 6 million goes up will get more quota.

Nishant Sharma — Edelweiss Wealth — Analyst

Okay. So currently, if you can just once again elaborate what exactly quota that we got it out of the 60 lakh ton.

Pramod Patwari — Chief Financial Officer

1.98 less.

Nishant Sharma — Edelweiss Wealth — Analyst

Okay. And of that 1.9 million, we have already contracted 1.4%, which we are planning to complete it by March.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Most of it by marks.

Nishant Sharma — Edelweiss Wealth — Analyst

Okay. So most of INR1.99 Second, sir, in terms of the export policy with respect to scrapping of Pota, — so here, this shopping between mills to mills or it will happen through government? And how do you foresee this change from a sector per se as well as from our company purse…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

I don’t understand the relevance of your question. If I may understand a little more, what you’re trying to ask a…

Nishant Sharma — Edelweiss Wealth — Analyst

Okay. So before asking questions, possibly, I may require back understanding that. If I’m not wrong, in the recent sugar export policy, government has stated that the melons were unable to do exports or who are not interested in doing exports, so they can suit their quota of export either to government or they can also stop it with the other companies.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

I understood your question. Don’t worry. We can sell his portas there’s no problem — nothing we…

Nishant Sharma — Edelweiss Wealth — Analyst

So I’m asking more from a perspective that I’m pretty sure that we can sell it. Is there an opportunity that we can have a more export sales with that shopping? Or we should — is there any, I mean, particular pointers that where we would be thinking whether we should take excessive export or we should more focus on the domestic side. So just wanted to understand that what would be the factors that would be affecting that staffing or considering those swapping?

Pramod Patwari — Chief Financial Officer

As far as Barak Chile is concerned, we will continue to revisit our strategy on this exports and domestic. It is a fungible policy, which the government has put in place. And at relevant point in time, we will take the decision.

Nishant Sharma — Edelweiss Wealth — Analyst

Okay, sir. Thank you I’ll call back in,

Operator

The next question is from the line of Richard DeSouza from SBI Mutual Fund. Please go ahead.

Richard DeSouza — SBI Mutual Fund — Analyst

Good afternoon, Sir. Thanks for giving me this opportunity. So I just wanted to ask in the internet remarks, it was mentioned that can availability could be about 15% to 20% higher in the current sugar year. So what gives us this confidence, sir?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. Avantika, will you take that question?

Avantika Saraogi — Business Lead

Yes. Thank you so much for the question. Basically, even though this untimely November has sort of — sorry, October in has scared people. As mentioned by the Chairman, it was quite late in the cycle when the crop had already reached a certain maturity — if I may give you a bit more technicality at the time of the initial growth, that is the main time frame where the weather was very, very conducive. So we were able to attain many more pillars, which increases the quantity right off the back. After this, it’s just a matter of attaining height. So it has impacted very marginally. We have been reviewing time and time again, clean availability is — the yield is higher per vehicle.

Also our area and the clean is 8% higher. So therefore, we are quite confident on the 15% to 20% increase in can, I think it should not be a problem.

Richard DeSouza — SBI Mutual Fund — Analyst

Just to continue on this, ma’am. Last year, we had some issues with the CO238 seats, and we were planning to replace it with the new variety of seats or with a different variety of seats. So how is the transition certified?

Avantika Saraogi — Business Lead

So thank you again for remembering. It’s definitely on it on the enor planning, our projection has happened, whatever we were planning. So we are down by 15%, 20% on 238. So lean steadily, it’s reducing plus we have gotten much more aware of the disease and how to control it and not bring it to our mill gate. So that procedure has been a tight almost, I would say, through these few months, we have been added.

I think the recoveries will also be much better because of the better varietal balance also plus within 238 also, it will be clean up. And there’s lesser incidents in terms of each plot. So less spread because we were able to control.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

There is another evidence that there is a testing done before the start of season. Yes, it’s called the handball and analysis. Even that shows recovery to be better. Trend will be better, much better than last year.

Richard DeSouza — SBI Mutual Fund — Analyst

Okay, okay. So can we assume the recovery rate of what was there a couple of years back?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. at can definitely over that.

Richard DeSouza — SBI Mutual Fund — Analyst

Okay. Thank you, Sir. I will come back in line. Thank you very much.

Operator

The next question is from the line of Achal Lohade from JM Financial. Please go ahead.

Achal Lohade — JM Financial — Analyst

Good afternoon, thank you for taking my question. Sorry, I joined a little bit late if you have addressed this. Sir, if you could clarify on the lower sales volume for display in terms of the target what we had earlier we had indicated, are we on track to achieve that FY 2013 discern sales volume target?

Pramod Patwari — Chief Financial Officer

Yes, Sachin, we are on track as far as FY 2023 is concerned.

Achal Lohade — JM Financial — Analyst

Which is somewhere around INR5.5 crores liter, if I recall right, sir?

Pramod Patwari — Chief Financial Officer

Total alcohol supply would be around INR23 crores to INR24 crores liter.

Achal Lohade — JM Financial — Analyst

That is for next year, you see, right?

Pramod Patwari — Chief Financial Officer

FY 2023.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

This year, can availability was lower. — distilling is lower, Monica lower distill capacity will be lower in the year gone by. In the year to come, promoter giving the payer.

Pramod Patwari — Chief Financial Officer

And for FY 2024, it should be around INR35 crores.

Achal Lohade — JM Financial — Analyst

Understood. [Indecipherable] Sir, if you could help us with the realization for the second quarter in terms of the ERA and also the quantity? And is there any inventory write-down in the disparate segments to pertain into…

Pramod Patwari — Chief Financial Officer

There is no inventory write-down as far as D&A is concerned. And for you won’t separately the figures of E&A that I will share at a later late time. I don’t have the fee as of now in terms of the…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Has been significant estrogen.

Achal Lohade — JM Financial — Analyst

Okay. Because if I look at the production number, the — the balance is substantially large number. While in the sales volume, it is substantially lower numbers, if you could help us understand that in the second quarter.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Per month.

Pramod Patwari — Chief Financial Officer

Production during the second quarter of cal was around INR3,870 crores return…

Achal Lohade — JM Financial — Analyst

Yes.

Pramod Patwari — Chief Financial Officer

Yes. And sale was around INR411 crores liter.

Achal Lohade — JM Financial — Analyst

No, sir, what I’m saying is as of BNC ethanol, the production was 3.87%, and the sales was 6.2%, if I have got the numbers right.

Pramod Patwari — Chief Financial Officer

No, sir, what I’m saying is as of BNC ethanol, the production was 3.87%, and the sales was 6.2%, if I have got the numbers right.

Achal Lohade — JM Financial — Analyst

Okay. Okay. Got it. And if I may ask, what is the impact of this wage revision you have quantified for the total impact. But on a recurring basis, what is the cost impact of this wage revision?

Pramod Patwari — Chief Financial Officer

Maybe INR1 crores, INR1.5 crores annually?

Achal Lohade — JM Financial — Analyst

Perfect. Okay. And if you could also clarify on this molasses quota part as to what is the quantum now and what is the impact of that in the September quarter with respect to that?

Pramod Patwari — Chief Financial Officer

So as far as molasses policy reset is concerned, we don’t sell molasses. Normally, we don’t send Malate, but we are converting that into ENA for discharging obligation. So as and when the DNA gets sell, sellout, the impact is already in the accounts.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

And just to clarify the current year molasses policy, which has come out, the country liquor policy is a lot friendlier than the previous one.

Achal Lohade — JM Financial — Analyst

Would it be possible to elaborate a bit, sir, on that?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

No, we are under reading. It will require more betting, but it is seeming to be friendlier. That’s all what you can pay us.

Achal Lohade — JM Financial — Analyst

Got it. And — with respect to the cane crushing, you said 10.5 million tonnes for the current season, sugar season 2023. Would it be possible to give some idea in terms of fiscal year, sir, how it will look like?

Pramod Patwari — Chief Financial Officer

90 plus 50% of the

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Okay. tailing. We do see them by Yes. Continue with the map.

Achal Lohade — JM Financial — Analyst

Sure. If I may ask a couple of more questions.

Avantika Saraogi — Business Lead

Around INR10 crores.

Pramod Patwari — Chief Financial Officer

Around INR10 crores into

Achal Lohade — JM Financial — Analyst

Okay. 10 controls in FY 2023. And. I think we…

Operator

Are may I request you to please…

Achal Lohade — JM Financial — Analyst

I’ll come back in the queue. thank you.

Operator

Thank you. The next question is from the line of Nitin Awasthi from Credit Equities. Please go ahead.

Nitin Awasthi — Credit Equities — Analyst

Hello sir, thank you for the opportunity. I would like to understand, sir, what were the expectations of the revised rate of ethanol that you had? And how do you perceive the rates given by the government as of now, you as the company and you as the representative at of the industry, how do you force these rates? Do you think it’s fair? Do you think there’s a revision required?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So let’s be clear as to what the thinking going around is there was the special incentive given for four to four months now, July onwards from July to November, something like that from July November August to November, so that if you supply more than your — if you supply during that period, you would get something higher in terms of INR two or…

Pramod Patwari — Chief Financial Officer

1.6%.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. So that was done to incentivize during those four months. One cannot expect that to be a part of the rate. Hence, the rate we been announced by the government is a function of increase in FRP as a percentage. Two, I would be hopeful and this is just again a very personal remark, absolutely personal. As to the same incentive might come around during those four months in the current year.

So I am to see reputation of photopolygovernment does not get its quantity. Maybe that incentive comes in the next four months. Thirdly, what Pramod has been saying is even in the interview today, be additional capacity now has to come from sacrifice of juice rather than BAV, for which you need new capacity addition. For the attracting new capacity and giving the new capacity a decent IRR, you would need a price which is higher than this current price of about 65 on…

Nitin Awasthi — Credit Equities — Analyst

1.5.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. So these are specific remarks to your questions.

Nitin Awasthi — Credit Equities — Analyst

Got it, sir. Sir, the second question following relating to the first one is that given that currently we have capacities of molasses, green and juice. And when you do the math better than anybody else, would you still go for the juice route and the current season or the molasses route is more profitable?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Juice…

Nitin Awasthi — Credit Equities — Analyst

Even at the current rate, uses more profitably.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. The investment is already being set up. basis use in one year. So we will then do the juice.

Nitin Awasthi — Credit Equities — Analyst

Got it sir, thank you very much.

Operator

Thank you. The next question is from the line of Anupam Goswami from B&K. Securities. Please go ahead.

Anupam Goswami — B&K. Securities — Analyst

Hi, Sir, my first question on the — what is your aim on the distillery mix. So where do we see how much can diversion happening towards A? And how much — and what would be the rest of the grain liters in this? — let’s say, on FY 2024 basis, INR35 crore liters, if we are targeting.

Pramod Patwari — Chief Financial Officer

So we will answer your question from the sugar season perspective. Okay. So the diverting around 6% to 7% 6%?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Maybe…

Pramod Patwari — Chief Financial Officer

58% 8% in juice and 20% in — for ENA and the rest will go to BA.

Anupam Goswami — B&K. Securities — Analyst

Okay. And Red would be for grain. So our endeavor mostly still lies on B-heavy mode. And because of the higher margin spin now, sir?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

It’s all a very related business. So it’s — let us run the juice, which has been done for the first time. Let us see the return. We hope to get a very good return. Once we establish everything, the juice capacity is limited. So if one will deal with all these mathematics, the moment we have stabilized and run it. So as someone said, we know our numbers well, trust us with that.

Anupam Goswami — B&K. Securities — Analyst

Okay. Okay. And sir, do you have any chance of SSE again being hiked because last year, we had a hefty hike. And this year was the provability…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Hoping for no hike.

Anupam Goswami — B&K. Securities — Analyst

Okay. Okay, sir. And sir, last question, we are heading towards, let’s say, of six million tonnes next season diversion. So where do we see six million tonnes and how much liters we can produce as an industry out of that? And going beyond where do you see any government support required for going beyond that?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Like this season pass at four and a half — you’re saying next year six million, it’s too early to comment today.

Anupam Goswami — B&K. Securities — Analyst

Okay. Okay. Thank you, sir. I’ll join back.

Operator

The next question is from the line of Nikhil Gada from Abacus Asset Management. Please go ahead.

Nikhil Gada — Abacus Asset Management — Analyst

Yeah. Hi, sir, thanks for the opportunity. my first question is regarding the exports back where you said that it’s going to be in the ratio of 25 to 75. Would it be possible to even share the realization what we would be garnering over here?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So — yes, we are still in the process of pricing it. We’ll get back to you. Yes. See, we are going to sell refined sugar as a major part of it. 75% refined sugar.

Nikhil Gada — Abacus Asset Management — Analyst

And analyzation by airline

Vivek Saraogi — Executive Chairman of the Board, Managing Director

It’s a very good realization.

Nikhil Gada — Abacus Asset Management — Analyst

Understood.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

We’ll give you the figure during the call only.

Nikhil Gada — Abacus Asset Management — Analyst

Okay, sir. Sir, my second question is just when you mentioned that for the distillery breakup, 8% just 20% ENA, that means basically see heavy, right through CB route?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. That is the liability to be discharged as per the policy for country leaders. If you give more less, you get a poor realization, you give Egea better realization.

Nikhil Gada — Abacus Asset Management — Analyst

Understood. Got it. Right, sir. Understood. And sir, lastly, any comments on the global prices and how do you see them? Because in last, I think, a month or so, we have seen a very sharp spike in sugar prices globally? And how do you see the situation with expectations of Brazil and Thailand are coming back to normalcy in terms of their production?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So it is gaining in Brazil and tile. So probably the crop might not be as good as one thought. And this price right now is very lucrative. It has gone up, and it is a holding chance for Indian exports to be priced in. We feel more than 4 million must have been done.

Nikhil Gada — Abacus Asset Management — Analyst

Got it, sir. That would be a. Thank you so much.

Operator

The next question is from the line of Dixit Mittal from LIC Mutual Fund. Please go ahead.

Dixit Mittal — LIC Mutual Fund — Analyst

Yeah, sir, my question is on expected recovery this season, can you give some guidance on that?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So as we said in the beginning, a anaphasmentioned, understand let me strain to a little more about the case drop. So when the yield is good, the can is healthier. So when a game is — each stick is healthy, the recovery growth inside it is higher. So we are hoping for a better recovery based on the handball analysis and based on the weight of the mother suit. So that trend is higher definitely. In our area, we’ve done the mapping. And once we start the crushing, we’ll get more and more data as we proceed.

Dixit Mittal — LIC Mutual Fund — Analyst

Okay. So can we expect at least 1% higher recovery or too much to see…

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. So somebody commented that can we expect what we got two years back. So that was probably three or 4 0.3% higher than the current yes. My answer was yes. We can definitely expect that

Dixit Mittal — LIC Mutual Fund — Analyst

Okay. Yes. Thank you, sir.

Operator

Thank — next question is from the line of Bhavin Tara. Sorry, Pavneet the queue — we’ll move to the next question, which is from the line of Charles Kanani from Centrum Broking.

Charles Kanani — Centrum Broking — Analyst

Thanks for the opportunity. Sir, just a small clarification, when we guided for INR23 crores alcohol sale, can is for FY 2023, is that right?

Pramod Patwari — Chief Financial Officer

Yes.

Charles Kanani — Centrum Broking — Analyst

So that would imply an implied growth of around 65% to 70% nearly in the second half of the year, which I think we are already — I think that is basically a balance on right? So is that achievable? No, that 60% 70% just on volume comes…

Pramod Patwari — Chief Financial Officer

Yes, we will get full four months of.

Charles Kanani — Centrum Broking — Analyst

Okay. Because the first half volume is around 9.3% alcohol, total courses. So if you are guiding for 23, basically, we’ll be doing something in the range of INR40 crores.

Pramod Patwari — Chief Financial Officer

Let’s see 23 is the numbers we are talking on.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Yes. So when you make juice, you may sell up a lot more quantity. And the tender should be accepted and the dispatch should be much faster.

Charles Kanani — Centrum Broking — Analyst

Okay?

Vivek Saraogi — Executive Chairman of the Board, Managing Director

I mean this is the target. If it’s here or there by 1 month, that’s the maximum as you can expect.

Charles Kanani — Centrum Broking — Analyst

Because I see the reason I asked is because the operation months are only four, four and a half months. So if we are off by 1 month, that would be nearly 25%, right. So it would be something in the range of INR1 crores, INR2 crores in that case.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So basically, our production, we know. We are hoping for that dispatch as for the tender printing. — okay, government body delay is lifting a 10, 15 days, you are talking balance sheet impact and sensitivity thereof. I cannot guarantee that because I’m not the government, I’m not the OMC. But seeing the power effective, it looks definitely possible.

Charles Kanani — Centrum Broking — Analyst

That’s what I wanted to know.

Pramod Patwari — Chief Financial Officer

Possibility. 22 to 23…

Charles Kanani — Centrum Broking — Analyst

Yes. So that is basically a range. I just wanted to clarify on that. Thanks a lot guys.

Operator

The next question is from the line of Achal Lohade from JM Financial. Please go ahead.

Achal Lohade — JM Financial — Analyst

Sir, my question was pertaining to the cane development program, what you had mentioned is that for the current season, 10.5 million tonnes for the next season, 11.5 million to 12 million tonnes. So the question is, a, how much more scope do we have given our catchment area; B, is that would also that require additional crushing capacity to be set up?

Avantika Saraogi — Business Lead

So I’ll take your questions. So in the East, where eight of our factories are located, there is a lot of scope for acreage increase. There’s no shortage really. And we don’t need to set up more crushing capacity to handle up to 11.5 million tonnes.

Achal Lohade — JM Financial — Analyst

Beyond that, no — is there any plan to set up? Is there a plan to increase the acreage quarterand and…

Avantika Saraogi — Business Lead

As we visit the topic.

Achal Lohade — JM Financial — Analyst

Understood. The second question I had with respect to the exports for the industry in the last season of the total export 11.2%, how much would be white sugar? And how much would be Roger, would there be any idea on that? And because why I’m asking because the refined sugar, the current realization appears to be extremely lucrative. So just wondering if most of the sugar exports will be of refined grade.

Pramod Patwari — Chief Financial Officer

I don’t have the figures right now available in front of me, but I recall out of 11.2 million tonnes tonnes was refined sugar. And we don’t have the breakup of raw and bite as of now.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

So there are defined export, which we tied up is a little above 38% and raw above 34%.

Achal Lohade — JM Financial — Analyst

Understood. This is very helpful, — thank you…

Operator

Ladies and gentlemen, this was the last question for today. I would now like to hand the conference over to the management for closing comments.

Pramod Patwari — Chief Financial Officer

Thank you very much. I hope we have been able to answer all your questions satisfactorily. Should you need any further clarification or would you like to know more about the company, please feel free to contact us. I again thank you for taking the time to join us on this call. Thank you.

Vivek Saraogi — Executive Chairman of the Board, Managing Director

Thank you, everybody.

Operator

[Operator Closing Remarks]

More BALRAMCHIN analysis

Transcript powered by AlphaStreet

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company’s SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.