Dwarikesh Sugar gains on capex plans

Dwarikesh Sugar Industries advanced 3.56% to Rs 77.10 after the company said that it has embarked upon a project to set up a 175 kilo litre per day (KLPD) distillery at its Dwarikesh Dham Unit, in Bareilly, Uttar Pradesh.

Necessary LOIs for the critical equipment's are under issuance, the company said.

The company's existing distillery capacity is 162.5 KLPD, with existing capacity utilization being approximately 90%. It proposes to add a capacity of 175 KLPD to its distillery unit.

The company expects to complete the project within 15 to 16 months.

The project cost is Rs 232 crore, of which Rs 185.6 crore would be via bank finance and the remaining Rs 46.40 crore would be via internal accruals.

The sugar maker said that the project announced is in line with the Indian government's commitment to broaden the ethanol manufacturing base in India from agricultural resources. The proposed distillery will utilize sugarcane juice/syrup as its principal feedstock during the cane crushing season and turn to B-Heavy molasses route (or grain) during the off season for continuous manufacture of ethanol.

Dwarikesh Sugar Industries is a leading player in the Indian sugar industry, engaged in the manufacture of the finest grains of sugar, as well as allied products.

On a consolidated basis, Dwarikesh Sugar Industries reported a net loss of Rs 26.69 crore in Q4 FY21 as compared to a net loss of Rs 1.41 crore in Q4 FY20. Net sales declined 8.1% to Rs 87.03 crore in Q4 March 2021 over Q4 March 2020.

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