Dhampur Sugar Aims for Growth with 350 KLPD Ethanol Capacity and Product Diversification

Dhampur Sugar Mills Limited , a prominent player in the Indian sugar industry, has unveiled plans for integrated growth and diversification. The company aims to expand its ethanol capacity to 350 KLPD (Kilo Liters Per Day) and establish new greenfield operations, signaling a strategic shift towards a more diversified product portfolio.

Expansion and Diversification Strategy

The sugar manufacturer is broadening its horizons by venturing into value-added products, including ethyl acetate and potable spirits. This move is expected to create additional revenue streams and reduce the company's dependence on traditional sugar production.

Key Strategic Initiatives

Dhampur Sugar is focusing on several key areas to drive growth and efficiency:

Energy Efficiency: The company is implementing improvements in energy efficiency across its operations.
Brand Development: 'Mishti by Dhampur' is being developed as a key brand in the company's portfolio.
Revenue Stability: By diversifying its product mix between sugar and ethanol, Dhampur Sugar aims to achieve greater revenue stability.

Government Policy Support

The company's expansion plans are supported by government policy measures, which are expected to contribute to margin expansion.

Financial Performance

Despite these forward-looking initiatives, Dhampur Sugar's recent financial results reflect the challenges faced by the industry:

Particulars (in Rs. Crore)	Q2 FY26	Q2 FY25	H1 FY26	H1 FY25
Revenue from Operations	711.20	580.40	1451.70	1258.30
EBITDA	10.40	5.10	41.10	36.10
Profit Before Tax (PBT)	-13.50	-20.20	-12.40	-18.20
Profit After Tax (PAT)	-8.80	-13.50	-8.10	-12.20

While the company has seen an increase in revenue, it continues to face profitability challenges. However, there are some positive indicators:

Sugar sales volume increased to 0.80 lakh tons in Q2 FY26 from 0.71 lakh tons in Q2 FY25.
Sugar realization improved to Rs. 39,956/ton in Q2 FY26 from Rs. 38,163/ton in Q2 FY25.
Ethanol sales volume grew to 132.47 lakh BL in Q2 FY26 from 93.17 lakh BL in Q2 FY25.

Challenges

The company faced headwinds due to lower pol in cane, which resulted in higher sugar production costs. The cost of production increased to Rs. 37,416/ton in the 2024-25 sugar season, up from Rs. 34,861/ton in the 2023-24 season.

Outlook

Dhampur Sugar's strategic initiatives, including capacity expansion and product diversification, may position the company for potential growth. However, the success of these efforts will depend on various factors, including market conditions, policy environment, and operational execution.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
-1.23%	-5.94%	-3.52%	-15.48%	-24.12%	-17.55%

Dhampur Sugar Mills has announced its financial results for the second quarter ended September 30, 2025, showing improved performance despite posting a net loss. The company demonstrated resilience in challenging market conditions while pursuing strategic growth initiatives.

Financial Performance Overview

The company's consolidated financial results for Q2 FY26 reflect a mixed performance with significant improvements in key metrics:

Metric	Q2 FY26	Q2 FY25	Change
Revenue from Operations	₹712.10 cr	₹580.74 cr	+22.6%
Net Loss	₹7.82 cr	₹13.42 cr	-41.7%
Total Income	₹713.95 cr	₹586.46 cr	+21.7%
Total Expenses	₹726.48 cr	₹606.53 cr	+19.8%

Segment-wise Performance

Dhampur Sugar Mills operates across multiple business segments, each contributing differently to the overall performance:

Segment	Q2 FY26 Revenue	Q2 FY25 Revenue	Growth
Sugar	₹342.01 cr	₹279.39 cr	+22.4%
Potable Spirits	₹230.16 cr	₹173.65 cr	+32.6%
Ethanol	₹103.92 cr	₹78.51 cr	+32.4%
Chemicals	₹60.36 cr	₹57.34 cr	+5.3%
Power	₹17.32 cr	₹15.01 cr	+15.4%

The potable spirits and ethanol segments showed particularly strong growth, reflecting the company's diversification strategy beyond traditional sugar operations.

Strategic Acquisition Initiative

In a significant corporate development, Dhampur Sugar Mills executed a Share Purchase Agreement on October 28, 2025, to acquire 51% stake in Venus India Asset-Finance Private Limited. The acquisition involves purchasing 4,72,87,537 equity shares from Venus India Structured Finance Master Limited, subject to regulatory approvals from the Reserve Bank of India and completion of specified conditions.

Financial Position and Liquidity

The company's balance sheet shows substantial changes from the previous year:

Parameter	September 2025	March 2025	Change
Total Assets	₹1,825.94 cr	₹2,387.01 cr	-23.5%
Total Equity	₹1,126.51 cr	₹1,153.35 cr	-2.3%
Current Assets	₹688.03 cr	₹1,241.27 cr	-44.6%
Current Liabilities	₹382.61 cr	₹965.57 cr	-60.4%

Commercial Paper and Credit Rating

Dhampur Sugar Mills maintains commercial paper listings on the Bombay Stock Exchange with an IND A1+ credit rating. As of September 30, 2025, the company had ₹200 crores outstanding in commercial papers, with repayment schedules of ₹100 crores each on October 10 and October 13, 2025.

Industry Context and Outlook

The sugar industry continues to face seasonal challenges, with the company noting that quarterly performance may not represent annual results due to the seasonal nature of sugar operations. The UP Government's redetermination of lower levy molasses obligation for 2024-25 positively impacted results by ₹1.72 crores during the quarter.

Despite posting losses, the company's revenue growth across multiple segments and strategic acquisition plans indicate management's focus on diversification and long-term value creation in the challenging sugar industry environment.