Magadh SugarQ4 FY24

Magadh Sugar Q4 FY24 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹505P/E: 13.8Market Cap: ₹712 CrSector: Agricultural Food & other Products

Management growth scorecard

Revenue

Category 3

Margin

Category 1

Fundraise

N/A

Order

N/A

Capex

Yes

2 of 3 growth signals are positive.

Full analysis

Revenue guidance

Category 3
  • Crushing capacity at Narkatiaganj unit is being increased from 7,500 TCD to 10,000 TCD, leading to a projected 28-29% increase in crushing volumes.
  • Total crushing in FY24 was 239.98 lakh quintals, up ~10% from the previous year, with scope to increase further due to varietal replacement and increased acreage.
  • Ethanol production capacity is being enhanced by converting Sidhwalia distillery to a multi-feed facility (capacity 80 KLPD), enabling use of maize/rice, targeting full utilization over 340 days to achieve up to 5.5 crore litres.
  • Sugar production rose 21% in FY24; increased crushing and recovery improvements are expected to boost production and sales going forward.
  • Sugar sales increased from 18.55 lakh quintals to 20.12 lakh quintals year-on-year; average realization improved by 6-9%, indicating better revenue prospects.
  • Overall, the company anticipates higher crushing, production, and better product mix contributing to growth in sales, revenues, and volumes in coming years.

See what Magadh Sugar management said on margin guidance — free account, 30 seconds.

Fundraise plans

  • The transcript does not mention any current or future fundraising plans through debt or equity.
  • Management has highlighted that by reducing their debt, they aim to have more financial flexibility for investing in value-creating projects.
  • Focus is on completing ongoing capex projects like the expansion of crushing capacity and conversion of distillery to multi-feed rather than raising new funds.
  • No specific announcements or indications of fresh debt or equity issuance were discussed during the Q4 & FY24 call.

See what Magadh Sugar management said on order book — free account, 30 seconds.

Capex plans

Yes
  • Magadh Sugar & Energy Limited is undertaking capex to expand the crushing capacity at the Narkatiaganj unit from 7,500 TCD to 10,000 TCD.
  • This expansion is expected to be operational by November-December 2024.
  • The total invested capital cost for this project is around Rs 141 crores.
  • The project aims to improve efficiency by reducing steam consumption from 44.7% to 34.8%, enhancing crushing capacity by about 28-29%, and increasing recovery.
  • The company is converting the Sidhwalia molasses-based distillery into a multi-feed distillery to utilize maize, rice, and other grains for ethanol production.
  • The capacity utilization of the distillery is planned to increase to 340 days, with production potentially rising to 5.5 crore liters.
  • Capital cost for the distillery conversion to multi-feed is approximately Rs 32 crores.
  • These investments aim to optimize ethanol production under the new ethanol policy and leverage local maize availability.

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