Ponni Sugars Erode Limited has initiated a postal ballot to secure shareholder approval for a comprehensive Memorandum of Understanding (MoU) with Seshasayee Paper and Boards Limited (SPB). This move aims to streamline and consolidate their related party transactions (RPTs) for a five-year period from January 2026 to December 2030.

Key Details of the Proposed MoU

The new MoU, if approved, will supersede all existing agreements between the two companies and cover a range of transactions:

1. Purchase, sale, supply, exchange, or transfer of:

   • Bagasse
   • Sugar
   • Fuel
   • Power
   • Water
   • Other products

2. Availing and rendering services

3. Sharing of common expenses

Financial Implications

• The aggregate value of all RPTs with SPB is capped at Rs 60.00 crore per financial year during the MoU's tenure.
• This amount represents approximately 16.80% of Ponni Sugars' annual consolidated turnover for the immediately preceding financial year (2024-25).
• For SPB, the transactions would account for about 3.40% of its annual consolidated turnover.

Strategic Importance

The bagasse supply arrangement forms the foundation of Ponni Sugars' establishment and its promotion by SPB. Key points include:

• Ponni Sugars commits to supplying a fixed percentage of its bagasse production to SPB.
• Pricing is based on the cost equivalent of alternative fuel used, plus an incentive component.
• The arrangement aims to secure continuous raw material supply for SPB's pulp and paper production.

Voting Process

• The remote e-voting period runs from November 5 to December 4, 2025.
• Shareholders as of October 31, 2025 (cut-off date) are eligible to vote.
• The resolution requires approval as an Ordinary Resolution.

Corporate Governance Aspects

• The Audit Committee, consisting of only independent directors, has reviewed and approved the proposed RPTs.
• The company is seeking fresh shareholder approval, adhering to the revised SEBI guidelines on minimum information disclosure for RPTs.
• SPB holds a 32.35% stake in Ponni Sugars, making it a related party under the Companies Act, 2013 and SEBI-LODR regulations.

This move by Ponni Sugars demonstrates its commitment to transparency and compliance with regulatory requirements while maintaining its strategic partnership with Seshasayee Paper and Boards Limited.

Ponni Sugars Erode , a prominent player in the sugar industry, has released its financial results for the quarter ended September 30, 2025, showcasing a mixed performance with notable growth in profits but a significant decline in total comprehensive income.

Key Financial Highlights

Quarterly Performance Analysis

Ponni Sugars demonstrated robust growth in its core operations during the second quarter of the fiscal year 2025. The company's total income from operations surged to ₹11,471.00 lakhs, marking a significant increase of 16.93% compared to ₹9,810.00 lakhs in the same quarter of the previous year. This growth in revenue indicates strong market demand and potentially improved pricing for the company's products.

The net profit after tax for Q2 2025 stood at ₹1,456.00 lakhs, representing a healthy 17.99% increase from ₹1,234.00 lakhs reported in Q2 2024. This improvement in profitability suggests effective cost management and operational efficiency.

Earnings Per Share and Shareholder Value

The company's basic earnings per share (EPS) showed a notable improvement, rising to ₹16.93 in Q2 2025 from ₹13.41 in the corresponding quarter of the previous year, reflecting a 26.25% increase. This growth in EPS is likely to be viewed positively by shareholders, as it indicates enhanced profitability on a per-share basis.

Comprehensive Income Concerns

Despite the positive trends in revenue and net profit, Ponni Sugars faced a significant setback in its total comprehensive income. The company reported a comprehensive loss of ₹3,122.00 lakhs for Q2 2025, compared to a profit of ₹856.00 lakhs in Q2 2024. This stark reversal, representing a decline of 464.72%, may raise concerns among investors and analysts about the company's overall financial health and exposure to market volatility.

Half-Yearly Performance

For the six-month period ending September 30, 2025, Ponni Sugars reported:

• Total income of ₹17,843.00 lakhs, up from ₹15,849.00 lakhs in the previous year
• Net profit of ₹1,928.00 lakhs, compared to ₹1,828.00 lakhs in the corresponding period last year

These figures indicate a steady performance over the first half of the fiscal year, with moderate growth in both revenue and profitability.

Conclusion

While Ponni Sugars has shown impressive growth in its core operations and profitability for the quarter, the significant decline in total comprehensive income presents a complex picture. Investors and analysts may need to closely monitor the factors contributing to this comprehensive income loss, as it could impact the company's long-term financial stability and market valuation. The sugar industry's inherent volatility and external market factors may play a role in these mixed results, underscoring the importance of a thorough analysis of the company's future prospects and risk management strategies.