Dhampur Bio Organics Ltd (DBOL) Q4 FY23 Earnings Concall Transcript

Dhampur Bio Organics Ltd (NSE:DBOL) Q4 FY23 Earnings Concall dated Apr. 27, 2023.

Corporate Participants:

Mr. Navin Agrawal — Head of Institutional Equities

Nalin Gupta — Chief Financial Officer

Gautam Goel — Managing Director

Analysts:

Nimish Sheth — — Analyst

Sanjeev Kumar Damani — SKD Consulting — Analyst

Udit Gupta — individual investor — Analyst

Hiten Boricha — Sequent Investments — Analyst

Sunil — Bank Securities — Analyst

Prashant Balan — individual investor — Analyst

Presentation:

Operator

Ladies and gentlemen, good day, and welcome to the Dhampur Bio Organics Limited Q4 and FY ’20 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance — please note that this conference is being recorded. I now hand the conference over to Mr. Navin Agrawal, Head of Institutional Equities at SKP Securities Limited. Thank you, and over to you, Mr. Agrawal.

Mr. Navin Agrawal — Head of Institutional Equities

Good afternoon, ladies and gentlemen. It’s my pleasure to welcome you on behalf of Dhampur Bio Organics Limited and SKP Securities to this financial results conference call. We have with us Mr. Gautam Goel, Managing Director; and his colleague, Sandeep Sharma, CEO; Mr. Nalin Gupta, CFO; and Mr. Mukul Sharma, COS. We’ll have the opening remarks from Mr. Goel, followed by a Q&A session. Thank you, and over to you.

Nalin Gupta — Chief Financial Officer

Yes. So everyone, I’m Nalin Gupta, so I’ll be starting with my remarks on the financials. Ladies and gentlemen, I’m Nalin Gupta, the CFO of DBO. We welcome you to our Q4 and FY ’23 earnings call. I’ll start with the key highlights of the quarter and the year that went by. Our revenue from the operations for the quarter increased from INR INR586 crores to INR974 crores — for the year, revenue increased from INR1,564.09 crores to INR2,646 crores — the key drivers for this are an increase in the quantity of sugar sold, increase in its wholesale and additions from our new country liquor production. Sugar sold increased from 3.3 lakh tonnes to 4.5 lakh tonnes in this year, which included 0.7 lakh tons of refined sugar, which was exported this year against export of 0.3 lakh tonnes last year. Ethanol sold increased from 436.7 lag bulk liters in FY ’22. — to 885.1 lakh bulk liters in FY ’22. We sold 11.6 lakh cases of Katiliquor during this year. For Q4 FY ’23 increased to INR94.3 crores from INR828 crores in Q4 FY ’22.

FY’ 23 increased to INR135.78 crores as against INR19.74 crores in FY ’22. Profit after tax in FY ’22 increased to 12.2 crores from INR14.05 crores in FY ’22. In Q4 FY 2023 Sugar segment reported a revenue of INR121 crores as compared to INR40.59 crores last year in this quarter. bitten Sugar segment stood at INR86.5 crores in Q4 FY ’23 as compared to INR77.35 crores in Q4 FY ’22. For the financial year, Sugar segment reported a revenue of INR2,252.47 crores in FY ’23 versus INR456.18 crores in FY ’22. EBIT in Sugar segment stood at INR11.7 crores in FY ’23. — as compared to INR18.88 crores in FY ’22. Our sugar relation for FY ’23 increased to 36.6 per kg against 35.1% last year. Our inventory as on 31st March 23 stood at 1.47 lakh tonnes of sugar, which has been valued at 33.9%. Our inventory as on 31st March 22 stood at 2.5 which was valued at INR33.99 per kg. Now moving to biofuel and speed segment. Our revenue increased to INR23.46 crores in Q4 FY ’23 as against INR112.7 crores Q4 FY ’23 ’22, sorry. In FY ’23, our revenue from biofuel segment increased to INR39.59 crores as against INR INR74.3 crores in FY ’22.

EBIT in FY ’23 increased to INR110.21 crores to INR64 INR68 crores in last year. Our total sale of ethanol of 85 bulks in FY ’23, 408.01-lakh bulk liters of ethanol was drived out of syrup against 119.6 bulk liters last year. While it can all drive out of baemolasis in FY ’23 was 467.2 lakh bulk liter as against 74.75 late last year. E&A sale in FY ’23 stood at 10 lakhs against INR42.2 lakh billion last year as we consumed a substantial portion of our E&A for Cantel manufacturing. Our average relation of ethanol stood at 6.83% in FY ’23 against 55.1 later last year. And another driver for the increase in revenue, is there a sale of country liquor in the current year. Revenue for — from the country liquor in FY ’23 stood at INR275.6 crores and INR131.7 crores in FY ’23.

We sold 11.62 lakh cases of country liter in this quarter. I’m sorry, we sold in 6 cases of country liquor in this year. at an average realization of INR25.14. This relation is net of excise duty. It is pertinent to note that aside duty component included in the turnover in this segment is to INR46.9 crores in FY ’23 and INR17.78 crores in Q4 ’23. We generated 34.53 core units in FY ’23 against 31.75 crores units in last year. We exported INR14.67 crore units at average realization of 3.3 per unit in FY ’23 as compared to 14.03 core units at an average relation of 3.18 last year. Coming to the borrowings. Our interest costs increased to INR40.74 crores Excuse me. So our interest cost increased to INR40.4 crores as against INR39.6 crores in comparison to last year. Higher cost — interest cost is on account of higher utilization of working capital in H1 FY ’23 drawing fresh term loans of INR140 crores for the capex undertaken by the company during this year and increasing rate of interest. Working capital as of 31st March 23 stood at INR460 crores vis-a-vis INR64 crores last year. Working capital utilization substantially dropped in last quarter due to sugar exports. We made a repayment of long-term loans of INR62.8 crores during FY ’23. Our long-term loans stood at INR431 crores as on 31 March 23. Long-term loans and short-term rating of our company continues to be assigned at A+ with a stable outlook by KAR. During FY ’20, in terms of IndAS was at operating segment, Sugar and biofuel in space have been identified as operating segments pertaining to the group’s operation and segmental information. In 24 of previous periods have been accordingly compared as restated and disclosed in the results. These were broad numbers. I would request our Managing Director, Mr. Goel to share his perspective on the industry and performance of the company in this quarter. Over to you, other.

Gautam Goel — Managing Director

Thank you, Nalin. Ladies and gentlemen, I am pleased to share our key operational performance for the quarter and the year. For the quarter, we crushed 23.11 metric tons of gain, 23.11 lakh metric tons of gain versus 21.10 lakh metric tonnes first. On the cutting for the year stood at 43.22 lakh metric tons as against 4.34 lakh metric tonnes for the previous year. We diverted 5.99 lakh metric tons of gain for syrup derived ethanol versus 1.53 lakh metric tons during the previous years. Sugar sales during FY ’23 stood at 4.53 lakh tonnes including exports of 0.7 lakh tonnes as against the sugar sale of 3.3 lakh tonnes for the last year. As mentioned during our previous — during my previous con call, I am pleased to report that we successfully fulfilled our entire export obligation through fine-grained refined sugar exports. We have established ourselves as a reliable high-quality producer. — and we delivered our fine grain and refined sugar to the exchange and to customers in 23 countries across Asia, Middle East, Africa and Europe. Ethanol production doubled this year to 980 lakh million liters bulk liters as compared to 460.46 lakh bulk liters.

The company sold 1.51 lakh tonnes per gas or INR63 crores as against 1.01 lakh tonnes per gas for INR26 crores last year. As mentioned during our previous introduction, — our drop in gross recovery was compounded due to the severe pest infestation in our small and Mansco units. The gross recovery for the year is lower by 0.4% compared to last year. We have intensified our game development activities to reverse this falling recovery. We mitigated a substantial portion of the loss from reduced recovery by higher bags and ethanol sales.

Additionally, our successful commissioning of pharma grade should have resulted in better realizations. Within five months of us commencing a country liquor business, we have become a top 10 country liquor supplier in UP and we continue to hold this position by this quarter end. We hope to fulfill most of our levy obligations of molasses for the year from the sale of Country liter. Sharing my perspective of the macro scenario. The net sugar production for the current current season too is expected to be around 32.8 Lakhs million tonnes, 32.8 million tonnes, with a diversion of 4 million tonnes towards ethanol.

Exports from India till now have crossed 5 million tonnes as against an export quota of 6 million tonnes. Sugar production in North India, including UP, is up by 4%, with a 9% drop of sugar production being witnessed in Western pace. This year, the OMC standard for a total of 600 crore liters of ethanol as against INR459 crore liters last year. Till date, the OMCs have executed had executed 6 tender cycles, and a total of 518.4 crore liters has been awarded. The total quantity lifted until 16th April stood at 208.7 crore liters. That is 40% of the finalized quantity and the average blending stood at 11.59%.

Till the distributor sector was allocated 377.43 crore liters. — comprising of 142.82 crore liters derived from sugar syrup and the balance quantity is predominantly derived from B-heavy molasses. — the grain sector continues to grow exponentially. This year, this sector has so far contracted for 414.92 per liter as against 51.48 crore liters last year and 47.46 cool liters two years ago. We are expected to further increase their quantity and proportion during the next center cycles.

The Indian sugar production is estimated to drop by 2.5 million metric tons as per the native my estimates. The expected production should be in the region of 32.8 million metric tons, out of which 31.1 million metric tons of sugar is already produced till 15th of April. Maharashtra has recorded a drop of 3 million metric tons and Karnataka 0.5 million metric tons. UP has produced 9.66 million metric tons in 15th April, and 77 factories are still operational and is estimated to produce 10.5 million tonnes during this full season, a marginal increase from 10.2 million metric tons produced last year.

As mentioned earlier, out of the 6 million net tonnes of sugar permitted for exports, 5.4 million tonnes have already been exported and the balance is expected to be shipped by 31st May. The government has released 18.5 million tonnes of sugar for the domestic quota until May 23, which is 2% higher than the 17.7 million tonnes released until May last year. Domestic prices look firm on account of lower production and the prices have moved up by 7% in April on the previous month.

The government released an additional 2 lakh tonnes of quota for the month of April. The cure current XL prices are in the range of 3350 to 3,400 sequential in Maharashtra, 3,600 to 3650 per quintal in UP. Refined sugar continues to get a premium ranging from INR50 to INR80 per quintal over plantation with sugar. The global outlook for sugar remains extremely tight and bullish. The 3 main producers in the treatment producers, India, Thailand and EU are expecting a shortfall in production. — further resulting in a tightness.

And due to this, the world market has valued over 20% in the last four weeks alone. Indian production is short by 2.5 million tonnes as compared to last year. They supplied– last year, they supplied 10.7 million tonnes of sugar to the world market. And this year, the supply is capped at 6 million tonnes, and the trade believes it could go down to 0 or 2 million tonnes over next year. The tire production estimates for the current year have been revised to 9.8 million tonnes from the initial estimates of 11 million tonnes.

Projections for next year have been revised downwards to 8.5 million tonnes. EU production estimates are around 15.5 million tonnes, which makes them a net importer of sugar. They are expected to have dry weather, which will lead to reduced yield in the deep planting. — which means the scope for next year toois not good. Brazil seems to be the only origin which can infill this deficit. Brazil is estimated to produce 38.5 million tonnes of sugar basis, 49% Sugar mix. The total expected us the total can cash is expected to be around 600 million tonnes. Brazilian milled ore price for the current crop and there is a huge pressure on margin market-to-market on them, which can lead to further price movement in case they are forced to start unwinding.

Also, the SNL parities are around $0.19 today. versus the sugar price of $0.26, which would make them want to maximize their sugar. Considering the shortfall in all major regions, the sugar balance sheet is extremely tight, which is getting reflected in the international sugar prices. with the highest level in the last decade. This concludes our synopsis for the quarter and the year gone by. We look forward to answering any questions that you may have. Thank you

Questions and Answers:

Operator

Thank you very much. [Operator Instructions] The first question is from the line of Nimish Sheth from [Indecipherable]. Please go ahead.

Nimish Sheth — — Analyst

Rest of the team– Just a couple of comments.

Operator

There are some audio loss. Please repeat yourself.

Nimish Sheth — — Analyst

Yeah, hi, Gautam, Nalin. Good evening, guys. Your results are very timely and very well appreciated. Hello?And your maiden dividend of INR3.5 also well appreciated. It’s a 21% payout. So thank you. Promoters now own more than 50%, which is also well appreciated. We’ve announced the sugar capex 4,000 PC. So that’s something we are looking forward to. I have a question on ethanol, but I’ll ask that along with the cane. Just one comment. Your presentation was uploaded at 2:00 to us before the call. If you could please upload it a few hours earlier for the previous day that help investors — now the questions actually. The first one is on the gain side. You already spoke about the gain situation. What are — so when will we see improved results on the can side, what are the steps the management taken or is taking to improve farm yields and also factory recoveries. And the second question related to this is, once you have your cane availability improvement, are there any thoughts on any ethanol-related capex?Should I Yes, please. And then there’s one more on the accounting side, which I will

Gautam Goel — Managing Director

Okay. Thank you for your compliments, much appreciate it. Now on the cane side and noted on the presentation, we will definitely passion is uploaded at least a day in advance. As we’ve been mentioning for some time, the cane area remains that the cane seems to be a major focus area. Now we seem to be successful in increasing our overall throughput over the last two years, we continue to crush a little higher than the previous year. This year, too, we are cashing– we’re going to be cashing higher than the corresponding period last year and for the entire season. The big focus, of course, now continues to be recovery. We have been working extensively to contain the pest– sort of related damage in 2 of our units.

These two units comprise about 70% plus of our cane crash. We have been calling the best scientists. Our team has been working in a pretty much day and night. And we are finding some encouraging results over there. Along with that, we are also working hard to replace and bring in new varieties, which are — which should give both higher yields and higher recoveries. But where ITL replacement is a little time is a little long drawn affair. We hope to start seeing some better the results of this maybe two years from now. That is the results from the parietal replacements. The results on account of better sort of the results on account of the containment of pests, we hope we can start seeing the results from next year itself. We hope it will result in further an improvement of recovery and further increase in clean cash. One of the principal reasons for announcing the expansion of our Megan unit is because we are encouraged by the increase in cane acreage.

And again, development efforts should also increase the gain goal. So sort of encouraged and are feeling bullish on this sector, on the segment. On the increase in ethanol capacity, that is definitely being worked out. We are definitely looking to increase our ethanol capacity. We hope we should– we are sort of still at the level where– I believe the next big increase will come in our mega unit, and we are working and we are studying that sort of we’re setting the optimum time to announce this. Because we have to have both the raw material supply. And now dual feed came distilleries have also become an option. So we are starting on both these accounts, and hopefully, we should have some news sooner than later. Thank you.

Nimish Sheth — — Analyst

Okay. Thank you. And just two accounting questions. Just clarifications actually. Do you see your consolidated results, the table on page 16, which you gave two days ago other expenses have increased from FY ’20 INR176 crores. This is an annual basis INR72 crores in the current year. So what exactly is other expenses?

Gautam Goel — Managing Director

Hi, Nimish. Thanks for your appreciation. And definitely, we’ll take note of your session for uploading a presentation, it did before. Nimish, as you might have noticed, there is a substantial increase in production of ethanol. Ethanol production has almost doubled, right? And so there are two part of it. One is 176 to 270 difference is around INR94 crores, right? So out of INR94 crores, INR21 crores is on account of consumption and packing due to the higher volume in ethanol segment and additional country liquor production. Another important part of the increase in expense is export logistics. Out of this INR64 crores is on account of the transformation of the sugar from factory to the port. So these are the two heads. Otherwise, we are good or otherwise.

Nimish Sheth — — Analyst

Yes, I think that explains everything. And one– just one more clarification, please, LNG. On the next page, Page 17, your segmental results, your item two other — under there, there’s unallocable items. And for the year, it’s INR41 crores for FY ’23 versus 14.46% for FY ’22. Again, what is this other unallocable items?

Gautam Goel — Managing Director

So there are certain heads, which are not overloaded on the cost of production. So last year, if you remember, we got dimers from Dambush Limited in April last. So accounting was happening in the undivided company. So a couple of expenses were part of the Dambush limited till March 23, which mainly accounted for the managerial remunation, which was part of Jambusar last year. which have come now into DBO right? And so considering that, a lot of expenses were there, which have become part of DBO now. So the rate is going to be like that.

Nimish Sheth — — Analyst

Okay. And one last clarification. Gautam mentioned that 76,000 or 75,000 quota has been completed export quota. In your presentation, you mentioned that in FY ’23, 70,000 tonnes have been exported. So I’m just assuming it means 6,000 is being done in this quarter, 1Q.

Gautam Goel — Managing Director

Yes, that’s correct.

Nimish Sheth — — Analyst

That’s all. I just–

Gautam Goel — Managing Director

Yes, that’s correct. On exported higher export obligation is fulfilled.

Nimish Sheth — — Analyst

That’s what you had mentioned Okay. Perfect. Thank you so much and wish you all the best for the coming year. And thank you for a nice dividend year. That’s a nice start. Thank you.

Operator

Thank you. The next question is from the line of Sanjeev Kumar Damani from SKD Consulting. Please go ahead.

Sanjeev Kumar Damani — SKD Consulting — Analyst

Namaskar, Am I audible, sir?

Gautam Goel — Managing Director

You’re audible.

Sanjeev Kumar Damani — SKD Consulting — Analyst

Sir, one small thing that I heard in the presentation from your side today in this call is regarding Bhagat, if I’m not mistaken, so kindly give you Q3 information on Bhagat, whether we entirely sell our Bhagat or we consume it. And is there substantial improvement in realization of Bhagat in the market this year as compared to last year. And can you quantify the tonnage also at how much tonnage we sold and how much we are producing per unit?

Gautam Goel — Managing Director

So Bhagas increases on two accounts. Principal usage of Bhagas, of course, is to under supr factory. And balance we need a Bhagas and we need to save some of our bagas to operate our distillery during the off-season. Both during season and off season, our distilleries is earning on the Bagas as a principal fuel. And when the sugar is not cashing, then we need to make adequate storage of bagas for our off-season operations. [Indecipherable] itself also, if you notice, Amara Chaim name for the overall cane cash for this same cane season has been higher, resulting in overall higher bagas production over last year, we had undertaken various Bagas saving measures. [Indecipherable] bagas saving measures on the undertake [Indecipherable], they have resulted in an increased saving in bagas. Which has resulted in us being able to sell more Bugas than we did last year. Last year, we sold about 1 lakh tonnes of Bagas. And this year, we have sold 1.5 lakh tons of Bagas. And we have also been lucky this year, the rates of Bagas have been higher as compared to the last — as compared to last year. So this increase sort of contribution from Bagas to [Indecipherable] on account of 50% additional quantities sold and the higher rate of [Indecipherable] Bagas

Sanjeev Kumar Damani — SKD Consulting — Analyst

Can I just know the current price–

Gautam Goel — Managing Director

We are continuing to invest further increasing our Bagas as the years go by.

Sanjeev Kumar Damani — SKD Consulting — Analyst

Okay, sir. Can you just know the current prices of bags that we sell a?

Gautam Goel — Managing Director

So Bagas prices — current prices of Bagas region specified cater [Indecipherable] region, we have Mali be in the region of INR300 to 350 per point of per gas.

Sanjeev Kumar Damani — SKD Consulting — Analyst

Okay, sir. Thank you very much. And all the best to you sir.

Gautam Goel — Managing Director

Thank you, Sanjeev.

Operator

Thank you. The next question is from the line of Udit Gupta, an individual investor. Please go ahead.

Udit Gupta — individual investor — Analyst

Good afternoon, sir. So my question is, sir, like the processing cost of the [Indecipherable].

Gautam Goel — Managing Director

Sorry, come again. The cost of portion you were talking about was it or?

Udit Gupta — individual investor — Analyst

For both, sir.

Operator

Sorry to interrupt you, Mr. Gupta, please use the handset mode, sir. Your audio is not clear.

Udit Gupta — individual investor — Analyst

Yes. Sir, my question is the cost of production and the processing cost of ethanol.

Gautam Goel — Managing Director

So the cost of production on the serum drive ethanol is around INR54 rupees a liter, and Bhat is around INR45 rupees a liter. And conversion cost is around INR six to INR seven rupees a liter in both the cases. So the conversion cost, does it include the depreciation of the interest or anything of the sort it includes.

Udit Gupta — individual investor — Analyst

It Includes. And sir, how many core liters of ethanol can be produced in the next financial years, like the current financial year?

Gautam Goel — Managing Director

We are in a–as the government [Indecipherable] capacity, we can produce above we can sell a little less than INR11 crores be INR10.92 crores liter is the total amount of ethanol, we are permitted to produce and sell.

Udit Gupta — individual investor — Analyst

Sir, does this include the levy molasses or is it like talking about the sales to the OMC?

Gautam Goel — Managing Director

Total alcohol production quantity restricted the government [Indecipherable] government [Indecipherable] department. Now if we have to supply EMA to a distillery, to a country liquor plant, this will be part and parcel of this 10.92.

Udit Gupta — individual investor — Analyst

Okay. And sir, I was trying to say like if we deduct the levy molasses portion from this part, so how much are we normally left with?

Gautam Goel — Managing Director

The levy molasses is a little bit work in progress because it’s difficult to say. Our current estimate as for the current duplicate, your current levy obligation requirements here. We will have about INR9 crore liters to the oil companies OMCs and 1.9 balance quantities would be earmarked for the– towards G&A and country liquor.

Udit Gupta — individual investor — Analyst

Thank you so much — thank you.

Gautam Goel — Managing Director

Thank you.

Operator

The next question is from the line of Hiten Boricha from Sequent Investments. Please go ahead.

Hiten Boricha — Sequent Investments — Analyst

Sir, I have a couple of questions. So, my first question is on the capex side. So, we have been spending on two plants was one may consume it. And second, we are also expanding the liquor cases. So, can you help me with the exact amount what the total amount of capex we are spending? And if you can give me a breakup of both?

Gautam Goel — Managing Director

We are not really — we have already expanded our country liquor segment. There is no further expansion plan there. Now the entire expansions for this year will be towards margins, unit expansion, some energy efficiency related matters and things like this. But Nalin, would you like to give some–?

Nalin Gupta — Chief Financial Officer

So yes, as Gautam mentioned, like Sandile expression has already completed last year, we have completed carbon side part also. So, we spent INR214 crores as capex last year for various measures.

Hiten Boricha — Sequent Investments — Analyst

Okay. Sir, actually, my question was how much we have spent on liquor and what are we planning from [Indecipherable], the breakup of the [Indecipherable]?

Gautam Goel — Managing Director

You’re talking [Indecipherable], or are you talking about for the coming year? I’m a little confused.

Hiten Boricha — Sequent Investments — Analyst

I’m talking about in general liquor [Indecipherable] total [Indecipherable].

Gautam Goel — Managing Director

Our expansion for liquor and expanded capex for liquor, we don’t expect to do any more expenditure there.

Hiten Boricha — Sequent Investments — Analyst

[Foreign Speech] That is my question sir.

Nalin Gupta — Chief Financial Officer

So last year for putting up this plant, we spent INR18 crores of capex for this capacity of 4.2 million cases per year.

Gautam Goel — Managing Director

No, we are– the total capex or planned there is [Indecipherable] is in the region of for [Indecipherable], we are planning to spend about INR65 crores, sir.

Hiten Boricha — Sequent Investments — Analyst

Okay.

Gautam Goel — Managing Director

But there are some further capex is planned to see savings on inside only. So as of now, the Board has finalized and we have a plan to spend towards men energy efficiency and some other normal depreciation.

Hiten Boricha — Sequent Investments — Analyst

Okay. Okay.

Nalin Gupta — Chief Financial Officer

So [Indecipherable] INR65 crores we are planning.

Hiten Boricha — Sequent Investments — Analyst

Okay. And my second question is on the prices of the Bagasse. As you mentioned, the prices has went up and we also sold 50% higher volume last year. I just wanted to understand what was the prices last year? You have given around 300, 350 per quintal of Bagasse, this year. So last year, what was the prices, sir?

Nalin Gupta — Chief Financial Officer

250 around–last year, it was INR2,500 per tonne by gas on an average, for the last quarter. Right?

Gautam Goel — Managing Director

Yes. This is the same area [Indecipherable], which we have given 303 [Indecipherable].

Hiten Boricha — Sequent Investments — Analyst

Okay. Okay. So, I have a couple of questions. I’ll get back in the queue. Thank you.

Operator

Thank you. The next question is from the line of Sunil from [Indecipherable] Bank Securities. Please go ahead.

Sunil — Bank Securities — Analyst

Yes. Congratulations on good numbers, sir. My question relates to–can you repeat the volume of export in this quarter?

Nalin Gupta — Chief Financial Officer

So in total, we have exported till 31st March, 0.7 lakh tonnes against our export quota of 7.675 lakh tonnes. In this quarter, we have exported 0.58 lakh tonnes.

Sunil — Bank Securities — Analyst

And what was the– Sorry, what was the realization in exports?

Nalin Gupta — Chief Financial Officer

Realization is around INR40 net of expenses.

Sunil — Bank Securities — Analyst

Okay. And domestic realization, if you can say, excluding export in this quarter?

Nalin Gupta — Chief Financial Officer

In this quarter, realization is around 3.7% per kg for the domestic continue sold.

Sunil — Bank Securities — Analyst

Okay. And now you’re talking about the realization of domestic UP realization of 36, 36.5. So, for us, it will be higher than that or?

Gautam Goel — Managing Director

Market Normally, this is the price that we spoke about, the plantation vital quality-wise stores are here. And sugar generally gets us INR50 to INR80 premium. And so, we hope we should be able to realize that or some more.

Sunil — Bank Securities — Analyst

Okay. And in this last one quarter, how much more production we can do?

Nalin Gupta — Chief Financial Officer

So it was [Indecipherable] refined sugar, we are selling in the market. No [Indecipherable] sugar is being sold in the market.

Sunil — Bank Securities — Analyst

So you get a higher realization of around INR80?

Gautam Goel — Managing Director

Depending on the time on the season, average monthly year-on-year 50 to 80 business fluctuates.

Sunil — Bank Securities — Analyst

And another thing is how much more production we can do in Q1?

Gautam Goel — Managing Director

That is a– [Indecipherable] –a little bit mature for us. That would be a little bit more forward speaking statement, so we will refrain from answering that.

Sunil — Bank Securities — Analyst

Okay, but all the three plants are running, right?

Gautam Goel — Managing Director

As of today, two of our plants have stopped pushing our Mansurpur plant is still running.

Sunil — Bank Securities — Analyst

Okay. Okay. Fine. And last thing is about the industry. Do you expect inventory to be lower than last season, in this sugar season?

Nalin Gupta — Chief Financial Officer

Yes, sir. We definitely expect to draw down of inventory. We are updating you all the government statistics and government data 32.8 million tonnes is their production the estimated consumption should be in the region of about 28 million tonnes, so– or 6 million tonnes for port [Indecipherable]. So, you should have an inventory draw around 1.5-odd million tonnes on a [Indecipherable].

Sunil — Bank Securities — Analyst

So my point was like sugar, it has increased a bit in recent past and as the price increase immediately government came up with additional quota — so what’s your view on further price increase of sugar in the industry?

Nalin Gupta — Chief Financial Officer

As you know, you’ve all been in this industry, there is– they are government-related controls. But we are not– we don’t see any reason to think the prices will go down. The balance sheet remains tight. So– and the international prices are also firm, but the domestic balance sheet remains high for and we see prices to remain steady, maybe go up a little bit, but we don’t see any downward pressure at this point.

Sunil — Bank Securities — Analyst

Yes. Yes, that is fair. And last question, sir, next year, any indication how the crop is likely or production likely?

Nalin Gupta — Chief Financial Officer

I mean, I’m sure you read the reports, the planting data for Maharashtra and Kanata Padua. And it’s a little early to say because monsoons garner a lot of topics. But — for ourselves, we can say that our game development efforts, we are feeling quite enthused and excited and that is the reason why we are doing the expansion of our minimal unit, and we expect our capacity utilization should only improve in the coming years.

Sunil — Bank Securities — Analyst

Great. Thank you very much and all the best for the future.

Nalin Gupta — Chief Financial Officer

Thank you, Sami.

Sunil — Bank Securities — Analyst

Thank you.

Operator

[Operator Instructions] The next question is from the line of Prashant Balan, and our Investor. Please go ahead.

Prashant Balan — individual investor — Analyst

Hello.

Nalin Gupta — Chief Financial Officer

Sanjay.

Prashant Balan — individual investor — Analyst

Yeah, hello and good evening. Congratulations for such a good set of numbers. Just wanted to ask a small question. Do you expect this LNO to somehow impact the total sugar inventory in India one. And the sub-question would be, do you see the prices shooting up in India because of this phenomenon? And what is the expectation at your end that Lino definitely would have because we have seen in the last cycle of 2016, 2041, these kinds of things were usually predicted beforehand. So, this time, what do you think about it? So I have rammed that kind of comprehensive questions, whichever way you want to write.

Nalin Gupta — Chief Financial Officer

Prashant is a very — it’s a million-dollar question. The old world is talking at the whole sugar industry is talking about the probability of El that everybody says is considerably higher, they say the latest data sales is about 70% that will be my sort of that would be my assessment to

Prashant Balan — individual investor — Analyst

And we know —

Nalin Gupta — Chief Financial Officer

You see the prices of sugar or your sugar realization going up in case the El Nino sets?

Prashant Balan — individual investor — Analyst

See, no, this is the most important aspect

Gautam Goel — Managing Director

Yes.

Nalin Gupta — Chief Financial Officer

The fundamental — my belief, this is my personal belief, the first FCC fundamentally has a negative impact on rain, especially in the western side.

Prashant Balan — individual investor — Analyst

And India means big pay. So, there is always a dryer tell. There is no reduction of water in Maharashtra, especially. Normally, the dire sped mean lower yields across board. — and sometimes, it also results in higher recovery. So, the overall impact on the sugar as a balance, generally a little dated North India with sugar Cushing goes down, the recovery goes up to the sugar balance sheet remains maintained. We generally, the recovery goes up also, but the quantity of can that goes down is generally more than what we can get compensated by recovery. let’s also remember this year, there was 4 million Tonnes of export out of India. So in the event of deficit production or lower production, the key question is Will there be a shortage in India, I don’t think so. I don’t see the production dropping to less than 4 million Tonnes. But once again, the market should remain bullish should remain firm.

Nalin Gupta — Chief Financial Officer

That will be my —

Prashant Balan — individual investor — Analyst

All right. That answers my question. Thank you.

Nalin Gupta — Chief Financial Officer

Thank you.

Prashant Balan — individual investor — Analyst

Thank you.

Operator

Participants as there are no further questions from the participants, I now hand the conference over to Mr. Goel for closing remarks.

Gautam Goel — Managing Director

Thank you all. Thank you very much and thank you for all the advice you’ve given us and the complements you’ve given us. We appreciate it greatly. And as we mentioned in the past, please feel free to ask any questions that may arise in due course, you can email it to us, and we will respond at the forum will try and respond promptly. Once again, thank you very much, and have a wonderful day.

Nalin Gupta — Chief Financial Officer

Thank you very much.

Operator

Thank you. Ladies and gentlemen, on behalf of SKP Securities Limited, that concludes this conference. Thank you for joining us. Ladies and gentlemen, you may now disconnect your lines. Thank you.

Nalin Gupta — Chief Financial Officer

Thank you.