Dalmia Bharat Sugar gains on NCLT nod to Baghauli Sugar resolution plan

The business operations of Baghauli Sugar have been closed since 2016.

Dalmia Bharat Sugar (DBSIL) shares gained 2.3 percent intraday on November 30 after the company's resolution plan for the Baghauli Sugar and Distillery was approved by the NCLT.

Dalmia Bharat Sugar submitted a resolution plan for the revival of Baghauli Sugar and Distillery under the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code (IBC). This was approved by the Allahabad Bench of the NCLT. The approval of the plan, now, is solely subject to clarification from the Supreme Court based on past orders.

As of 12.15 pm, the stock was trading at Rs 461.2 apiece on the NSE, higher by 0.56 percent.

Baghauli Sugar has an integrated sugar complex for manufacturing crystal sugar, cogeneration of power & rectified spirit/portable liquor situated in Uttar Pradesh. The firm was a Sahara Group company and wholly owned subsidiary of Sahara Prime City, but the business operations of Baghauli Sugar have been closed since 2016.

It was referred to CIRP under the Insolvency and Bankruptcy Code on an application filed by Bank of Baroda, a financial creditor, under IBC.

DBSIL’s resolution plan is to infuse Rs 140.19 crore through equity and unsecured loan to Baghauli Sugar, which will then become a wholly owned subsidiary.

Dalmia Bharat Sugar and Baghauli Sugar are in the same industry, and its acquisition and revival would enable the DBSIL to increase its capacities in Uttar Pradesh, it said.

DBSIL has a capacity of 38,450 TCD (tonnes of cane crushed per day). It is a fully integrated player with 123 MW of cogeneration capacity and distilleries of 710 kiloliters per day along with incineration boilers.

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