EID Parry shuts sugar factory in Tamil Nadu, cites cane availability

EID Parry Ltd on Monday said it will close its sugar factory in Tamil Nadu's Pudukottai district, saying it didn't see a future for the business because of poor sugarcane supply.

The company, which is part of the Murugappa Group, had earlier announced the closure of its sugar unit in Puducherry, and mothballed another two in Tamil Nadu.

"The Company proposes to transfer assets of the (Pudukottai) unit to its other units and also dispose other assets as may be deemed appropriate. Kindly note that this is not a material event as per the Company's Policy for determination of materiality for disclosure of information or events to stock exchanges." it said.

The company's board, in a meeting on February 1, decided to shut down the Puducherry unit because of "abysmally low" cane cultivation in the area. 

Tamil Nadu, Karnataka and Andhra Pradesh are major sugarcane producers but weak monsoon for the past few years has hit production badly.

EID Parry posted a net loss of Rs 53.12 crore in the quarter ended June 30, 2019, as against net profit of Rs 54.43 crore registered in the same quarter last year. Its total income declined by 13 per cent to Rs 406.99 crore compared to Rs 467.95 crore during the same quarter last year.