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Last Updated : Jan 30, 2013 01:23 PM IST | Source: CNBC-TV18

Balrampur Chini likely to turn profitable in Q3

Uttar Pradesh-based sugar company Balrampur Chini is likely to turn profitable with the net at Rs 32 crore in the third quarter of financial year 2012-13 as against net loss of Rs 64 crore in a year ago period, according to CNBC-TV18 poll.

 
 
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Uttar Pradesh-based sugar company Balrampur Chini is likely to turn profitable with the net at Rs 32 crore in the third quarter of financial year 2012-13 as against net loss of Rs 64 crore in a year ago period, according to CNBC-TV18 poll.


Analysts on an average expect sales of the company to grow by 30 percent to Rs 860 crore from Rs 663.7 crore during the same period.


Earnings before interest, tax, depreciation and amortisation (EBITDA) are expected to be in black at Rs 105 crore in October-December quarter of 2012 as against operating loss of Rs 11.3 crore in the corresponding quarter of previous fiscal.


Analysts expect operating profit margin at 12.2 percent as against operating loss during the same period.


Sugar prices consolidated in the October-December quarter after seeing a high of Rs 37/kg in August.


Realizations ex-mill in UP are hovered between Rs 33-34 per kg, which is lower than Balrampur’s average realization of Rs 34.3/kg seen in second quarter.


So on a QoQ basis, analysts say average realizations should be a bit lower at Rs 33.5/kg.


But the key problem this quarter has been the high state advised price (SAP):


At the new SAP price (average Rs 280), the cost of production is around Rs 35/kg. So at current realizations the company has a negative margin on sugar sales, according to analysts.


However, Balrampur may still manage to post a profit in the sugar division because of inventory liquidation. Also cane availability has been good in UP which should aid distillery and co-generation operations.


Analysts feel total sugar sales volumes this quarter should be around 2.3 lakh tonnes.


Also Read: NALCO Q3 - Analysts expect profit to grow 57% at Rs 80 cr



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First Published on Jan 30, 2013 11:28 am
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