Balrampur Chini Mills Ltd (NSE: BALRAMCHIN) Q3 2026 Earnings Call dated Feb. 11, 2026
Corporate Participants:
Jenny Rose
Avantika Saraogi — Executive Director
Vivek Saraogi — Executive Chairman of the Board, Managing Director
Analysts:
Prashant Biani — Analyst
Vikram Suryavanshi — Analyst
Sanjay Manyal — Analyst
Tanuj Nagalia — Analyst
Hitesh Sharma — Analyst
Dhuvaneet — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Balrampur Cheney Mills Limited’s earnings conference call. As a reminder, all participant lines will be in the listen only mode and and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the 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 Ms. Jenny Rose from CDR India. Thank you. And over to you ma’.
Jenny Rose
Am.
Jenny Rose
Good afternoon everyone and thank you for joining us on Balrampur Cheney Mills Q3 and 9M FY26 results conference call. We have with us today Mr. Vivek Saraogi, Chairman and Managing Director of Balrampur Trini Mills, Ms. Avantika Saraogi, Executive Director and Mr. Pramod Patwari, Chief Financial Officer of the company. We would like to begin the call with brief opening remarks from the management following which we will have the forum open for the question and answer session. Before we start 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 included in the results presentation shared with you earlier. I would now like to invite Mr. Saraughi to make his opening remarks. Over to you Mr. Saraughi.
Vivek Saraogi — Executive Chairman of the Board, Managing Director
Thank you and good afternoon everyone and thank you for joining us on our Q3.9 month FY26 earnings call. I trust all of you have had the opportunity to go through the detailed presentation put out by the team which gives our operation financial performance. I will initiate the call with an update on the current developments in the sugar sector followed by a company’s key highlights for the period under review. India’s net sugar production. So I will just put this very simply. Our estimate is that Balrampur Chinimil’s internal personal estimate, the company’s estimate is 325 lakh tonnes diversion 35 lakh tonnes.
Net production of 290 lakh tonnes. 4 lakhs have been contracted for exports leaving a net balance of 286. Consumption is estimated. Some people say 288, some say 290. So net net if we do not go down to nitty gritty and of one or two lakh tonnes the assumption is that there would be no addition to inventory. There will be a minor depletion to inventory. The opening inventory is at bone thin levels which is at 5 million tonnes. And this in effect will lead to a very strong demand situation with no Inventory overhang. So therefore the pricing seems to be moving up.
Therefore it’s bullish for the prices and the prices in the month of February for UP Mills for our factory is between 41 and 41.5 which we feel can inch upwards as the season progresses. As the year progresses. On the policy front, cane prices have been increased by several key producing states adding to cost pressures for the mill in UP, we have had a 30 rupee increase in price. In this scenario, a revision in MSP aligned with cost current cost structures becomes critical for timely payment to farmers and to maintain market stability without any fiscal burden on the government.
So again I’ll give a little perspective to this. MSP might not be relevant at this point of time with the current prices of up. However, this is a bottoming kind of a signal from the government which will be a sort of which comes in hand when you begin the season in December etc. And it is a signal which is much needed and much overdue. However, if let’s say MSP came today, it would not change the pricing trajectory. Now the real concern is about the ethanol pricing. I’ll come to later. So one concern about the potential ethanol imports from us etc.
Have been eased following the recent trade agreement. However, uncertainty continues around long term revision of domestic ethanol price. Despite an increase of 16.4% in the FRP and operating costs, ethanol prices under B heavy and juice route have not been revised. Pramod is the third year now. This is extremely disappointing and we are extremely surprised since this revision which was sought would have marginally or absolutely sub marginally impacted either the OMCs or if they decided to pass on to the consumer it would be in the tuna. 10 to 20 paisa per liter on a price of.
What’s the petrol price? 100%. Yeah. So it around if the pump price for the consumer 100 rupees. This was a 10 20% pack. So this kind of amazes us as to why this has not been done for the third year post FRP revision of 16.4%. Without this in future, millers will have to rethink about large scale diversion and the E20 program. I’m not sure but it needs more attention. It began with a lot of commitment. That commitment has been sort of reneged upon by the government midway. Against this backdrop, the company delivered a healthy operational and financial performance.
Sugar segment performed well supported by improved realization. Distilled segment delivered stable performance back of higher volumes. However, margin remained under pressure in the absence of ethanol price division. Sugarcane crushing for the company for the period under review increased by 8.4% to 387.6 lakh quintels supported by early commencement of operation and improved capacity utilization. Despite a decline in overall sugarcane acreage. Company expects higher crushing levels for itself during the season under review, aided by additional area allotted by the government and better yield owing to our working with the farmers closed Our PLA project continues as planned.
Construction activities are in full swing with more than 3,000 workers being deployed at site. Approximately 90% of the imported equipment has arrived and the balance is on schedule and in transit market. Development efforts have commenced through trading of imported PLA. As of 31 January, cumulative project expenditure stand at 1421 crores funded through a combination of 790 crores via debt and balance through internal accruals. We remain committed to sustainable value creation by optimizing operations maximizing value extraction from each unit of sugarcane. Our diversified product portfolio, including PLA’s initiative is closely aligned with emerging global sustainability trends and strengthens the long term resilience of our business.
So we continue to focus on debottlenecking, enhancing efficiency, strengthening stakeholder relationship and we continue to be very careful and prudently look forward to deploying our capital. This brings me to the end of our discussion. I now hand over the floor to Avantika for giving an update on the on Cain and pla. Thereafter Pramod can take you through the financials. Thereafter we’ll do the Q and A session.
Avantika Saraogi — Executive Director
Good afternoon everyone. Thank you for having me. So just a very quick update on both first Cain and then pla. So I just want to highlight that we are, I mean as already highlighted within the opening remarks, but we have a we expect a 5 to 6% increase in the crushing this year vis a vis last year. And I also want to share some encouraging news for the upcoming year. We expect an increase in area of about 5 to 7% in the upcoming season as well. Not only since cane prices have been increased, but we have also been allotted some new geographies other than this, our development activities in cane.
I want to highlight one in particular. So in our insect pest disease management program we have now focused since the last two years very, very heavily on mechanical control by allocating lab budgets rather than chemical budgets since, you know, actively since the last three years we have ramped this up and this has encouraged this has not only increased the fertility of the soil but increased the actual sort of resilience of the crop against these kind of insect pest diseases, whether it’s Top borer or whether it is red rod. We have relied less and less on chemicals and more and more on mechanical and bio controls, reducing the carbon footprint of sugarcane cultivation.
Secondly, now I would like to move on to pla. I want to highlight another figure which might not be so visible to investors that the trade of PLA since the time that we have announced the project has nearly doubled if we are to take the annual import of PLA and its product. So it used to stand between 4 to 5,000 tonnes before we announced the project as NEAT PLA. And we expect that at least a 4 to 5 fold at a conservative level in compounds and finished goods was coming in. But now we see it at around 10,000 tonnes annually in the year of 2025.
And again we your consequent four to five fold in compounds of PLA coming in. So while our trade and our sales figure might not exactly reflect the exact plaque market in India, I just wanted to highlight this to show that we have been working relentlessly and with a lot of compounders and converters and achieving not only sort of goodwill but real technical success which has never been seen before in India. As highlighted last time, we had worked on over 50 projects out of which 20 have been closed successfully and 30 are ongoing. And we see success in them all.
So the technical success is actually what I would like to highlight in the downstream technology. That’s it from me.
Vivek Saraogi — Executive Chairman of the Board, Managing Director
Thank you. Good afternoon everyone. I would not like to repeat the financial numbers which we had already shared in the detailed presentation. I would now request the moderator to open the forum. Thank you.
Questions and Answers:
operator
Sure. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask questions may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles to ask questions. Please press star and 1. The first question is from Prashant Biani from Elara Capital. Please go ahead.
Prashant Biani
Yeah, thank you for the opportunity, sir. Regarding this ethnol pricing, if we have to look the other way, you know, what is the incentive for the government to increase the ethanol price? Right now lending targets have been achieved and we have ample capacities also. So till the time there is sugar glut or even standalone ethanol companies are on the verge of bankruptcy. Government may not increase the price at all from here. Your view on it.
Vivek Saraogi
So we are talking as if you know government is running business. So Government is supposed to be running a system which is for the well being of the country. And that’s where this policy began. So just because you get capacity up to what you need, you don’t stop increasing the price. And the commitment which was made, which was followed up to 22, 23 which was if 5% was the rise in FRP, 5% was the rise in ethanol price. So you know, if we talk like and if I may speak a little informally, government is not a bania.
Government is supposed to. This is climate friendly, farmer friendly. So owing to this, exports were not needed, export subsidies were not needed. Owing to this, farmers were paid on time. You suddenly for, you know, don’t backtrack midway.
Vivek Saraogi
And just on the price front they would just increase prices based on the consequent increase of sugar cane prices. They need not quantity of ethanol in that. So that actually has no relevance to sugar.
Prashant Biani
I agree with all that. But I mean because now government is acting like a banya only. So then.
Vivek Saraogi
Then you’re right. So that’s why they’ve not yet increased it. So these are not moves with any kind of long term thinking. Suddenly something has gone off and I government has been pragmatic for years and I am very hopeful that they would again see pragmatism down the line.
Prashant Biani
Sure. So on PLA, while we would be supplying to converters, but have we got any formal or informal assurance from any of the potential client for offtake or you know, either from railways or defense or temples where we are also targeting them a potential client for the end product.
Vivek Saraogi
So I mean I’m not at liberty to tell you as of today, but the fact that we have put the names in our investor presentation and how sort of prudent our conduct has been, it’s indication enough I think that you know, these are just some institutions and then there are lots of private and everything. There’s really very, very encouraging market coming for pla. I highlighted it in the figures for this very reason.
Vivek Saraogi
So if you see inside and I think this may be of interest to all investors and Avantika knows better. So the PMO initiative and if you know those things play out, in short.
Vivek Saraogi
Give the perspective the entire program of this Gutka Bhat Masala packaging. So there was a, there was an article and a press release from the government which included our name and our PLA and basically for the application of Gutka and Pan Masala packaging. So this is one of the most visible litters causing 22% silting in drain systems in urban India. So the PMO is really taking up this in a very fast track manner. And we have been able to get technical success, which has only before this happened in China in terms of being able to convert the product with quality.
And on the existing legacy machines that exist in the country, that was the only roadblock. We have already achieved technical success. We have done prototypes and it has already gone for user and degradation testing and SOP and all of that is being done. So the government is working really, really fast and really, really cohesive on that. So, you know, if we look at sachet usage in India, you guys will probably be better at estimating the exact figures. But it’s something like in hundreds of thousand of tons. And why I’m harping on the technical efficiency is that it’s extremely difficult to get the oxygen and water vapor barrier right with the, you know, with bioplastics and biodegradable materials which we’ve been able to do.
This is, you know, this is a great thing and the cost is also decent.
Vivek Saraogi
So there’s a lot of promise, there is a lot of interaction and it’s not up in the air anymore.
Prashant Biani
Sure.
Prashant Biani
And while we are not really impacted by it.
Prashant Biani
But on the other side, is the.
Prashant Biani
Government also trying to separately pick up the waste product or the packing material which is made out of PLA at the garbage picking front?
Vivek Saraogi
Do you mean waste segregation? I mean the less we comment on waste segregation in India, the better. I don’t know what to tell you more than this. It’s not where it should be. And if it does happen like that, it’s rather simple to separate pla. There are n number of technologies and even mechanical properties which can be taught to the rack. Because just as they do for other products, they can easily separate pla.
Prashant Biani
Sure. That’s it. From my side.
Prashant Biani
Thanks.
operator
Thank you. The next question is from Vikram Suryavanshi from Philip Capital. Please go ahead.
Vikram Suryavanshi
Hi, good afternoon sir. Hope I’m audible.
Vivek Saraogi
Yes, thank you. All good.
Vikram Suryavanshi
Okay, so first of all I want to acknowledge you for giving a more realistic production estimates in presentation compared to what we used to get from different sources. For initial. If you look at our initial estimate as a country and now the significant downward revision which was expected, how much coming from UPA and Maharashtra? If you can give some broad sense.
Vivek Saraogi
Ramod up production, we are looking at maximum of 10 million at a gross level and Maharashtra, Karnataka maybe 17 and a half to 18 million. Maharashtra, Karnataka put 10, 18, 28 and rest of India 47, 325 people. Okay, that’s the breakup.
Vikram Suryavanshi
And second, you highlighted about increased cane allocation by 5 to 7%. So does that additional land, what you have got already has a significant amount of cane or there is a further scope to improve further cane development going forward there. So we can see apart from the area fin availability can also increase significantly.
Vivek Saraogi
Good point, good point, good question.
Vivek Saraogi
Actually I just want to clarify. It’s not 5 to 7% increase in allotment, it’s 5 to 7% increase in crushing. 5 to 6% increase in crushing that we expect. This is not only through external areas but internal development and yields and everything. Now moving to the second part of the question. Yes, definitely the new areas which we have got already have gained, but they have a large opportunity to increase gain as well. And these are farmers who have not been paid properly. So they are very very happy and very very excited to actually see the color of money and work with us and increase.
Vivek Saraogi
Very hopeful increase variety, everything.
Vikram Suryavanshi
Got it. And in terms of yield improvement, we have seen improvement, but probably I was expecting significant improvement further from here. So was that improvement mainly because of weather related and recovery from the disease or we do can expect some structural yield improvement with varietal difference going forward also in terms of recovery as well as yield. If you can comment.
Vivek Saraogi
So I just want to highlight that we’ve been working very hard on variety since, you know, since Red Rod hit. So while the red rod variety is reduced to low single digits, we see an increase like 14, 201 is an established variety. Now this year we are already going to crush around 16% of it and we see a significant increase in the coming year. Similar to this we have two more varieties in the pipeline which have good potential for yield as well as recovery. So this is something that we are working on. Plus we have a four to five year plan and four other pipeline varieties which then come in.
So this is a very strong program with the tissue culture and everything that we have established. So we always try for structural change so that we do not need to rely as much on outside factors.
Vikram Suryavanshi
And last question, I think sir also talked about on ethanol views and all that. But just for clarity, if you look at situation remain and with sugar prices currently what we have, can we go for maximize sugar and then use the distillery capacity more for grain based ethanol as a structural change going forward or we still hope that government will consider the division in ethanol prices so we can stick with the existing models.
Vivek Saraogi
So what we have done pursuant to the fact that government did not increase price, we have already Diverted many of our units to, you know, C. Heavy grain is not possible in these units because grain is a separate line of machinery which is only available in Mesopotamia. So we have taken those decisions internally to maximize sugar production.
Vikram Suryavanshi
Okay, got it. So I was just thinking to can we also go for multi feed in other places also?
Vivek Saraogi
No, no, that’s not what we are planning.
Vikram Suryavanshi
Okay, got it. Thank you sir.
operator
Thank you. The next question is from Sanjay Manyal from Dam Capital. Please go ahead.
Sanjay Manyal
Yeah, I think my questions are pretty similar to what the previous participants has mentioned. So it is about the recovery specifically. I think initially we were thinking we were talking about 50, 60 probably basis point recovery improvement in Western UP and probably 2030 basis point recovery improvement in Eastern UP. But I think it’s fizzled out. Is it because of the ratoon crop or we may think we may get better in plant or you think that recoveries will probably will be flattish kind of for the season.
Vivek Saraogi
Good question Sanjay. So you’re right West, I don’t know. Even that’s not as nearly as high as what you’re saying. Lot from waste is higher by half and lot of waste is lower than last year. So waste is also divided into parts. Having said that, we began with an improvement of 0.3 kind of expectation for one and a half months we got no sunlight. So beginning as of yesterday bright sunshine has started again. So maybe we have lost some time which we did not anticipate. So 0.2 3 may not be possible. 0.1, 0.15 may be possible.
Sanjay Manyal
Okay, okay. And second about the fungibility part only it seems that Mesapur, I think initially when we did the capex For Mesapur for 320k LPD it was assumed that in a certain situation like today when the maize or the grain ethanol prices are higher, probably we’ll utilize this MESA Pro facility for a higher grain ethanol. But it seems that it will be less than 5 crore only. It seems to be that way only. What’s your view on that and why we have not been able to scale that up to 810 crore liters probably.
Vivek Saraogi
So Sanjay, please understand. We have a capacity of 5 and a half crore. 5 crore liters of maize for the balance amount of season after sugar season shuts down. Right. Balance period. Yeah, let’s let me get it very clear. Government has accepted only 60% of the tenders put out for maize. And you cannot put out a tender. Then what you have then your capacity. So we tendered for 5 crores, we got 3.1. 2. 3.15 crore. So government is not inherently very much in favor of that segment. So if you wanted to increase maize, you’d put in a capex.
Let’s say for another distribute of 10 crores you would only be able to sell 6 crores balance. The distill would be ideal. Am I clear? Right.
Sanjay Manyal
But my question was. Yeah. My question over here is that why we couldn’t bid more than 5 crores. Because if I’m not wrong, the entire Mesa Pool facility is fungible towards grain. So maybe I. I can do A C heavy means ethanol C heavy or B heavy.
Vivek Saraogi
Right, Right. So that was possible. But at that point of time one did not know that they are not going to increase the price. Having begun and tender, it’s not possible to roll back. And in the overall scheme, you know, until you reduce sugar, you don’t get a good price for sugar. Yes. I mean if I knew on day one that they are not going to increase any price, maybe we would have done lesser juice.
Sanjay Manyal
Right, Right. Understood. Understood.
Vivek Saraogi
But Sanjay, the capacity would have been idle. Huh? B.C. you would have done. But that grain would have gone for unutilized. Yeah. Or you 60% utilized. But yes, your question is valid. If we knew this on day one, we would have not done full use.
Sanjay Manyal
Right? Right. Understood. Understood. And so lastly on PLA front I think you have mentioned that you already started trading PLA and so is it, Is it that to build the market as of now we have to significantly reduce the price or sort of come up with the lower price to the clients?
Vivek Saraogi
No, no, no, no. This is not. We are wanting to do this so that we can get the technical feedback required for our also start creating a name in the market, meeting the right customers and everything. So customers are largely still importing on their own and just buying a small percentage from us and giving us feedback which is very valuable for when we start production.
Sanjay Manyal
Okay. Okay. This. These are only pilot works which is. Which is happening?
Vivek Saraogi
No, we are doing commercial sale also. But to a small percentage in order to get feedback on quality.
Sanjay Manyal
Okay. Understood. Understood. Thanks. Thanks. That’s it.
operator
Thank you. The next question is from Tanuj Nagalia from SKP Securities. Please go ahead.
Tanuj Nagalia
Hello everyone. Good afternoon. So sir, I wanted to know whether there is any change in the ethanol mix. As you said you will be making more of C heavy. So the previous mix you had said it was 25% C, 65% B and 10%.
Vivek Saraogi
It’s a very marginal tweak because. Yeah. So just one unit midway we Are shifting which may not because we have a 10 unit company. May not look very visible. But yes, whatever we can salvage, we are salvage.
Tanuj Nagalia
Okay sir. Thank you sir. My next question will be. So are we on track to close the financial year 26 with a ethanol sale of 28 crore DL?
Vivek Saraogi
Looks like between 26 to 27 crores.
Tanuj Nagalia
26 to 27. Okay. And so one last question like what kind of revenue are we expecting in PLA from the Pan Parag sachets which you were talking about right now?
Vivek Saraogi
This is too early in the day. Yeah.
Vivek Saraogi
So what we are wanting to say. Let’s understand what we are wanting to say without over expecting or under delivering. You know. So today this is something new for us. We are going in. There are two parts to this. One to make the quality. That is the function at the plant level. Two is to sell this. That is what your pan parag etc.
Prashant Biani
Is.
Vivek Saraogi
So separately working on these two and with the interactions we are having around we feel very very confident and happy that you know we should see success on both the fronts. The details of how we are hoping to be successful is all what we have spoken about.
Tanuj Nagalia
Okay, got it sir, just I can squeeze one last question. What is the cost of production of the sugar in Q4 Q3.
Vivek Saraogi
For the full year? We are around 37 hours.
Tanuj Nagalia
37 hours. Okay sir. Thank you so much. That’s from end.
operator
Thank you. The next question is from Hitesh Sharma from Goldman Sachs. Please go ahead.
Hitesh Sharma
Good afternoon everyone. I just want to check up on this pla. How much is a capacity relation right now and what sort of at the full capacity it will add to the profit.
Vivek Saraogi
So we are commissioning in October of 2026. So right now there’s of course no capacity. And then if on full capacity utilization revenue potential is 2000 crore at peak. And we have given guidance before of a 35% EBITDA profit margin.
Tanuj Nagalia
Thank you very much.
operator
Thank you. Before we take the next question, a reminder to participants that you may press star and one to join the question queue. The next question is from Dhuvaneet from Sabla family office. Please go ahead.
Dhuvaneet
Hi sir, I think so most of my questions have been previously answered. Just wanted to know on the ethanol bit, have we been. Have we know what kind of pricing are they going to go on the sea heavy route for this current sugar season? Because in case this is so they are they have given an increase last year also. If they give an increase right now then the price differential between the behavior route and the cavity is Very minimal. In that case it looks ominous that they might actually increase the price high on. On the behavior.
Right. At least or any in line with that on the cane use route. So that and what my second question is, what is our current conversation with regards to the government on this particular aspect? Are they still in talks with the government for the price division or have the talk stalled for now?
Vivek Saraogi
So I think what you’re meaning is whether there’ll be a revision for cav. So currently the indications are there is no revision on the end. So we have pitched, pitched and pitched. No reply is the message we have which I mean I cannot again this government which gives a feeling that they might not be looking at it. That is the indication. All products hence will remain the same. CB juice. So as far as November 24th, October 25th season. Right? Right. Oh thank you.
operator
Thank you very much. That was the last question in queue.
Vivek Saraogi
Sorry sir, can I give some closing remarks?
operator
Absolutely. Yes sir.
Vivek Saraogi
Yeah. So our hope, not more than hope. We are hoping to crash over 10.5 crore quintiles this year. Which is about 50, 10.55 actually which is about 60 lakh increase over last year. Yeah, about a 58, 60 lakh quintel increase which amounts to about almost 6%. Our ability with the Capex already done is to very easily handle half crore quintels. And we hope to achieve that very soon is the wish list. But it’s not a dream. We are working towards that and feel very positively inclined to achieving that. My hope is maybe part of that vision gets completed next year itself.
And in Maharashtri and up you would start seeing closures by February end. So that is why the price is where it is. And even the monsoon prediction which we have read about till now is not great. So I want seeing a structural kind of a tailwind to sugar prices as we proceed. So yes, one sector ditch ethanol, the other looks good. And especially for Balrampur. Right. Thank you.
operator
Thank you very much on behalf of Balrampur Chini Mills. That concludes this conference. Thank you for joining us ladies and gentlemen. You may now disconnect your lines.
Vikram Suryavanshi
Thank you.