Q2 FY2026 India Sugar Sector Report

Sugar Sector: Comprehensive Industry Analysis and Company Performance Review

The Indian Sugar sector, a cornerstone of the agricultural economy, is characterized by its cyclical nature, dependence on monsoon patterns, government policies, and increasing diversification into co-products like ethanol and power. The analysis of Uttam Sugar Mills Limited and Dwarikesh Sugar Industries Limited reveals a sector grappling with seasonal operational challenges, global price volatility, and evolving policy landscapes, while simultaneously pursuing strategic diversification and capacity expansion to enhance resilience and profitability.

A. INDUSTRY OVERVIEW & MARKET LANDSCAPE

The sugar industry in India is one of the largest globally, playing a crucial role in the rural economy by providing livelihoods to millions of sugarcane farmers. The sector is inherently linked to agricultural cycles, primarily the monsoon, which dictates sugarcane availability and quality.

**Total Addressable Market Size and Growth Rates:** While specific total market size figures are not provided, the operational scale of the two companies, with combined sugarcane crushing capacity exceeding 48,500 TCD (Tonnes Crushed per Day) and significant sugar production (Uttam FY25: 34.69 Lakh Qtls, Dwarikesh FY25: implied from revenue), indicates a substantial domestic market. The sector's growth is driven by consistent domestic demand for sugar, increasing consumption of ethanol for fuel blending, and demand for power from cogeneration.

**Market Structure and Segmentation:** The market is primarily segmented by product type: 1. **Sugar:** The core product, catering to both B2B (food processing, confectionery, pharmaceutical, bakeries) and B2C (household consumption) segments. Uttam Sugar, for instance, has a diversified product range including branded and specialty sugar, pharma-grade sugar, and invert sugar, indicating a move towards value-added products. Its presence on leading e-commerce platforms (BlinkIt, Zepto, Amazon) and association with premier hotel and cafe chains highlights its reach across both B2B and B2C channels. 2. **Ethanol/Industrial Alcohol:** A rapidly growing segment driven by the government's Ethanol Blended Petrol (EBP) program. Both companies have significant and expanding distillery capacities, reflecting the strategic importance of this segment for revenue diversification and stability. Ethanol is produced from molasses (B-heavy, C-heavy) and sugarcane juice. 3. **Power (Cogeneration):** Sugar mills generate power from bagasse (a byproduct of sugarcane crushing) for captive consumption and export surplus to the state grid. This provides an additional revenue stream and contributes to renewable energy targets. 4. **By-products:** Other by-products include bagasse (for paper, board), press mud (fertilizer), and spent wash (for potash manufacturing, as seen with Uttam Sugar).

**Key End Markets and Applications:** * **Food & Beverage Industry:** Confectionery, bakeries, soft drinks, processed foods. * **Pharmaceutical Industry:** Specialty sugars (e.g., pharma-grade sugar from Uttam). * **Automotive Fuel:** Ethanol for blending with petrol. * **Power Grid:** Surplus electricity from cogeneration. * **Agriculture:** Potash as fertilizer.

**Geographic Distribution and Regional Dynamics:** Both Uttam Sugar Mills and Dwarikesh Sugar Industries are primarily located in **Uttar Pradesh (UP)**, India's largest sugar-producing state. * **Dwarikesh Sugar:** All three plants are in UP, with two in Bijnor District (known for fertile, well-irrigated land and focused cane production) and one in Bareilly (low-lying Ganges plains with fertile alluvial soil). Their strategic locations provide access to large, clearly defined cane-producing areas and major sugar-consuming markets, with the Bareilly plant on a National Highway. * **Uttam Sugar:** While specific plant locations are not detailed beyond unit names (Libberheri, Barkatpur, Shermau, Khaikheri), their operations and cane crushing figures suggest a strong presence in the UP sugar belt.

The concentration in UP highlights the region's significance for the sugar industry, benefiting from favorable agro-climatic conditions and extensive farmer networks (Dwarikesh alone works with nearly 1.54 lakh farmers).

**Market Maturity and Lifecycle Stage:** The sugar industry is mature but undergoing a significant transformation driven by diversification into ethanol. While sugar production remains the core, the emphasis on value-added products (specialty sugars) and co-products (ethanol, power, potash) indicates a strategic shift towards a more integrated and resilient business model. The ethanol blending program, in particular, is injecting new growth avenues and reducing the sector's sole reliance on sugar price cycles.

**Industry Value Chain and Ecosystem:** The value chain starts with sugarcane cultivation (farmers), followed by crushing and sugar production in mills. By-products are then processed into ethanol, power, and other derivatives. Distribution networks channel sugar to B2B and B2C customers, while ethanol is supplied to Oil Marketing Companies (OMCs) and power is exported to the grid. The ecosystem involves farmers, sugar mills, government bodies (for policy, pricing, and ethanol blending mandates), OMCs, and various industrial and retail consumers.

B. FINANCIAL & ECONOMIC PROFILE

The financial performance of the sugar sector is highly seasonal, with Q2 and H1 typically reflecting the lean period or non-crushing season, leading to lower production and sales, and often negative profitability due to unabsorbed overheads. This seasonality is clearly evident in the provided data for both Uttam Sugar and Dwarikesh Sugar.

**Industry Aggregate Revenue Scale and Growth Trajectory:** Combining the H1 FY26 consolidated revenues of Uttam Sugar (₹1214.78 Cr) and Dwarikesh Sugar (₹654.20 Cr), the two companies generated approximately ₹1868.98 Cr in the first half of FY26. For the full FY25, their combined consolidated revenues were ₹1854.14 Cr (Uttam) + ₹1365.32 Cr (Dwarikesh) = ₹3219.46 Cr.

• **Uttam Sugar Mills Limited (Standalone):**

• **Dwarikesh Sugar Industries Limited (Standalone):**

**Profitability Levels Across Companies (Gross Margin, EBITDA, Net Margin):** Profitability in the sugar sector is highly sensitive to cane prices, sugar realizations, and the operational efficiency of co-product units (distillery, power). The H1 FY26 period, characterized by "complete absence of production" in Q2 and "negligible crushing operations and disrupted distillery activities" in H1 for both companies, resulted in significant pressure on margins due to unabsorbed overheads and the sale of high-valued opening inventory.

• **Uttam Sugar Mills Limited (Standalone):**

• **Dwarikesh Sugar Industries Limited (Standalone):**

**Range of Margins with Median and Outliers Noted:** * **EBITDA Margin:** Ranges from -15.8% (Dwarikesh Q2 FY26) to 12.35% (Uttam FY25). The H1 FY26 period shows a range from -5.3% (Dwarikesh) to 6.56% (Uttam). The significant negative margins for Dwarikesh in the lean season are outliers compared to Uttam's positive, albeit low, margins in the same period. * **PAT Margin:** Ranges from -13.3% (Dwarikesh Q2 FY26) to 5.07% (Uttam FY25). H1 FY26 shows a range from -6.4% (Dwarikesh) to 1.49% (Uttam).

**Return Profiles (ROCE, ROE, ROIC) by Company:** Specific return ratios (ROCE, ROE, ROIC) are not provided in the extracted data. However, the PAT figures and EPS can give an indication of profitability relative to equity/shares. * **Uttam Sugar (Standalone):** EPS improved dramatically from (₹4.10) in Q2 FY25 to ₹0.39 in Q2 FY26, and from (₹2.41) in H1 FY25 to ₹4.57 in H1 FY26. FY25 EPS was ₹23.92. This indicates a strong positive shift in returns to shareholders during the current fiscal year's first half. * **Dwarikesh Sugar (Standalone):** EPS deteriorated from (₹1.29) in Q2 FY25 to (₹1.76) in Q2 FY26, and from (₹1.82) in H1 FY25 to (₹2.27) in H1 FY26. FY25 EPS was ₹1.26. This indicates negative returns to shareholders during the current fiscal year's first half, worsening from the previous year.

**Working Capital Characteristics and Cash Conversion Cycles:** The mention of "sale of high-valued opening inventory (higher carrying cost, lower contribution)" by both companies indicates that inventory management and working capital are critical. Sugar is a commodity, and holding inventory can be costly, especially if market prices decline or if the inventory was produced at a higher cost. The seasonality of production means significant working capital is tied up in inventory during the non-crushing season.

**Capital Intensity Requirements:** The sugar industry is capital-intensive, requiring significant investments in crushing mills, cogeneration plants, and distilleries. Both companies have undertaken substantial capacity expansions: * **Uttam Sugar:** Installation of Incineration Boiler (2021), setting up a second Distillery unit (50 KLPD, 2021), Potash manufacturing plants (50 TPD in 2021, 200 TPD in 2022), and acquisition of Uttam Distilleries Ltd. (UDL) adding 40 KLPD (2024). These are significant capital expenditures aimed at diversification and increasing revenue streams. * **Dwarikesh Sugar:** A long history of capacity expansion in crushing (from 6,500 TCD to 21,500 TCD), cogeneration (from 17 MW to 94 MW), and distillery (from 30,000 LPD to 337.5 KLPD). Recent distillery expansions include 100 KLPD (2017), 130 KLPD (2019), 162.5 KLPD (2020), and 175 KLPD (2021). These continuous investments highlight the high capital requirements for growth and modernization in the sector.

**Revenue Quality (Recurring vs One-time, Contract Length):** Revenue from sugar sales is generally transactional, influenced by market prices and demand. However, sales of specialty sugars (Uttam) to B2B clients like pharmaceutical companies might involve more stable, longer-term relationships. Ethanol sales to OMCs are typically under annual tenders, providing a degree of recurring revenue stability, although prices are government-regulated. Power sales to the grid are also relatively stable. The diversification efforts aim to improve revenue quality by reducing reliance on volatile sugar prices.

C. COMPETITIVE STRUCTURE & DYNAMICS

The Indian sugar industry is fragmented, with a large number of mills, particularly in Uttar Pradesh, Maharashtra, and Karnataka. While the provided data only covers two companies, it offers insights into their competitive strategies and positioning within the broader landscape.

**Number of Players and Market Concentration:** The data does not provide overall market concentration figures. However, the presence of two significant players like Uttam Sugar (27,000 TCD crushing capacity) and Dwarikesh Sugar (21,500 TCD crushing capacity) in Uttar Pradesh, India's largest sugar-producing state, indicates that these companies are major regional players. The industry is characterized by a mix of cooperative and private mills.

**Competitive Intensity Assessment (Porter's 5 Forces style):**

• **Threat of New Entrants: Moderate to Low.** High capital intensity (setting up mills, distilleries, power plants), regulatory hurdles (licenses, environmental clearances), and the need for established cane procurement networks act as significant barriers. However, government incentives for ethanol production could encourage new investments in distilleries.
• **Bargaining Power of Buyers: Moderate to High.** For bulk sugar, buyers (traders, large industrial users) have moderate power due to the commodity nature of the product and availability from multiple mills. For ethanol, OMCs are the primary buyers, and their collective bargaining power is high, especially given government-regulated prices. Uttam's diversification into branded/specialty sugars and e-commerce presence aims to mitigate this by creating differentiated products and direct consumer access.
• **Bargaining Power of Suppliers (Sugarcane Farmers): High.** Farmers have significant bargaining power, especially in regions with high cane demand. Government-mandated Fair and Remunerative Price (FRP) or State Advised Price (SAP) for sugarcane protects farmers' interests, often leading to higher raw material costs for mills. Timely payment to farmers is also a critical operational and regulatory requirement.
• **Threat of Substitute Products or Services: Low (for sugar), Moderate (for ethanol).** For sugar, artificial sweeteners exist but do not pose a significant threat to the overall market. For ethanol, while it's a substitute for fossil fuels, the government's blending mandate ensures demand. However, policy shifts towards grain-based ethanol (as mentioned by Dwarikesh) could impact demand for molasses/cane-juice-based ethanol.
• **Rivalry Among Existing Competitors: High.** The commodity nature of sugar, coupled with regional oversupply or undersupply, leads to intense price competition. Mills compete for cane procurement from farmers and for market share in sugar sales. Diversification into ethanol and power helps reduce direct competition in the sugar segment and provides more stable revenue streams.

**Market Share Distribution:** Specific market share percentages are not provided. However, based on crushing capacities: * Uttam Sugar: Total 27,000 TCD * Dwarikesh Sugar: Total 21,500 TCD These capacities indicate both are significant players in the UP region.

**Pricing Power Dynamics and Pricing Trends:** * **Sugar:** Domestic sugar prices are influenced by demand-supply dynamics, government policies (e.g., minimum selling price, export quotas), and international prices. Both companies reported an increase in average domestic sugar realization in H1 FY26 compared to H1 FY25 (Uttam: ₹4102/Qtls vs ₹3934/Qtls; Dwarikesh: ₹3963.4/Quintal vs ₹3801.7/Quintal). This suggests firm domestic prices, supported by steady demand, as noted by Dwarikesh's management (approaching ₹4,100 per quintal). However, the global sugar market outlook is subdued with anticipated surplus seasons and sharp declines in international prices (raw sugar below 15 cents/pound, white sugar around US$ 420/MT), which could impact export opportunities if allowed. * **Ethanol:** Ethanol prices are regulated by the government and OMCs. Dwarikesh explicitly mentions "continued lack of revision in ethanol prices (especially for sugarcane juice and B-heavy molasses)" as a risk, putting pressure on mill margins. Average industrial alcohol realization for Dwarikesh was stable at ₹60.7/Ltr in H1 FY26 and H1 FY25. Uttam's distillery realization was ₹55.01/Ltr in H1 FY26, slightly down from ₹55.29/Ltr in H1 FY25, and FY25 average of ₹56.20/Ltr. The policy environment increasingly favoring grain-based ethanol is a concern for sugar-based ethanol producers. * **Power:** Power realization for Dwarikesh declined from ₹3.5/Unit in Q2 FY25 to ₹2.8/Unit in Q2 FY26. Uttam's power realization is not explicitly stated, but its power export significantly increased.

**Differentiation Strategies Employed:** * **Uttam Sugar:** * **Product Diversification:** Focus on branded and specialty sugar, pharma-grade sugar, and invert sugar. This moves beyond commodity sugar, targeting niche, higher-margin segments. * **Market Reach:** Presence on leading e-commerce platforms (BlinkIt, Zepto, Amazon) and association with premier hotel and cafe chains for direct consumer and premium B2B access. * **Integrated Operations:** Expansion into potash manufacturing alongside ethanol, creating a more circular economy model. * **Dwarikesh Sugar:** * **Geographic Concentration:** Strategic plant locations in prime cane-growing areas of Uttar Pradesh, ensuring consistent cane supply and proximity to major markets. * **Operational Efficiency:** Long history of debottlenecking and right-sizing plants to optimize capacity utilization. * **Scale in Co-products:** Significant and continuously expanding distillery and cogeneration capacities to leverage by-products.

**Consolidation Trends and M&A Activity:** Uttam Sugar's acquisition of Uttam Distilleries Ltd. (UDL) in 2024, adding 40 KLPD capacity, is an example of inorganic growth and consolidation within the distillery segment, indicating a trend towards expanding ethanol capacity through acquisitions.

**Competitive Advantages of Each Player:** * **Uttam Sugar:** * **Value-added Product Portfolio:** Strong focus on specialty and branded sugars, which typically command better margins and reduce reliance on commodity sugar prices. * **Diversified Revenue Streams:** Significant investments in ethanol, power, and potash manufacturing. * **Market Access:** Leveraging e-commerce and premium B2B channels for wider reach. * **Strong Growth in Specialty Segments:** Tripled sales in branded specialty products, tenfold increase in invert sugar, and threefold increase in pharmaceutical sugar over six years. * **Dwarikesh Sugar:** * **Strategic Location:** Plants in highly fertile and well-irrigated cane-producing areas of UP, ensuring reliable cane supply. * **Established Infrastructure:** Long history of capacity expansion and operational optimization across sugar, power, and distillery. * **Farmer Network:** Strong relationship with nearly 1.54 lakh farmers, crucial for cane procurement. * **Scale in Ethanol:** One of the larger distillery capacities among sugar mills, providing a significant hedge against sugar price volatility.

D. OPERATIONAL CHARACTERISTICS

Operational efficiency, cane availability, and recovery rates are paramount in the sugar industry. The seasonal nature of crushing operations heavily influences production and financial performance.

**Capacity and Utilization Trends Across Companies:**

• **Sugarcane Crushing Capacity (TCD):**

• **Distillery Capacity (KLPD):**

• **Power Capacity (MW):**

**Production Economics and Cost Structures:** * **Raw Material Cost:** Sugarcane is the primary raw material, and its cost is largely dictated by government-mandated prices (FRP/SAP). This forms a significant portion of the total cost of material consumed. Dwarikesh reported INR 10,315.0 million in cost of material consumed for FY25. * **Overhead Costs:** Both companies explicitly mentioned "un-absorption of overhead costs due to curtailed operational activity" in H1 FY26 as a reason for adverse financial performance. This indicates high fixed costs associated with maintaining large industrial setups. * **Inventory Costs:** "Sale of high-valued opening inventory (higher carrying cost, lower contribution)" was also cited as a challenge, implying that carrying costs (interest, storage) for sugar inventory can be substantial.

**Supply Chain Structure and Dependencies:** * **Sugarcane Procurement:** Highly dependent on local farmers and agricultural output. Both companies emphasize their presence in fertile cane-growing regions and relationships with farmers (Dwarikesh with 1.54 lakh farmers). Cane crushing figures (Uttam SS 2024-25: 401.68 Lakh Qtls, Dwarikesh SS 2024-25: 9.3 million MT for UP production) are critical indicators of raw material availability. * **Logistics:** Efficient logistics for cane transport to mills and finished product distribution to markets are crucial. Dwarikesh highlights its plants' connectivity to major consuming markets. * **Ethanol Offtake:** Supply to OMCs is a critical part of the ethanol value chain.

**Technology Landscape and Innovation Pace:** * **Modernization:** Both companies have a history of modernizing and expanding their plants (e.g., Uttam's incineration boiler, Dwarikesh's debottlenecking). * **Product Innovation:** Uttam's focus on branded, specialty, pharma-grade, and invert sugars demonstrates product innovation to cater to diverse industrial and consumer needs. * **By-product Utilization:** Investment in potash manufacturing (Uttam) and biomethanated spent wash plants (Dwarikesh) shows innovation in maximizing value from waste products and improving environmental sustainability. * **Cane Varieties:** Dwarikesh mentions continuous efforts in "varietal development" and the adoption of "robust, early-maturing cane varieties with improved disease resistance" to mitigate challenges like red-rot infestation (a risk for Co 0238 cane variety).

**Operational Efficiency Benchmarks:** * **Sugar Recovery:** Not explicitly stated, but "suppressed recovery" was mentioned as a reason for UP sugar production decline in 2024-25 by Dwarikesh. Management expects "meaningful improvements in crushing performance and sugar recovery" in the upcoming season. * **Capacity Utilization:** The "complete absence of production" in Q2 and "negligible crushing operations" in H1 FY26 for both companies indicate very low or zero capacity utilization during the lean season, which is typical for the industry but leads to unabsorbed fixed costs. * **Power Export:** Uttam's power export increased significantly from 27.46 Lakh KWH in H1 FY25 to 97.79 Lakh KWH in H1 FY26, indicating improved efficiency or higher generation during operational periods. Dwarikesh's power exported also increased from 0.3 Mn Unit in Q2 FY25 to 1.6 Mn Unit in Q2 FY26. * **Distillery Production:** Uttam's distillery production more than doubled from 208.57 Lakh BL in H1 FY25 to 412.37 Lakh BL in H1 FY26. Dwarikesh's ethanol production more than doubled from 98.07 lakh liters in H1 FY25 to 214.99 lakh liters in H1 FY26. This highlights the successful ramp-up of distillery operations and the strategic importance of ethanol.

**Key Performance Indicators (Company-specific and Industry Averages):** * **Sugar Production/Sales:** * Uttam H1 FY26 Production: 2.94 Lakh Qtls (vs 1.52 H1 FY25). Sales: 21.67 Lakh Qtls (vs 17.30 H1 FY25). * Dwarikesh Q2 FY26 Sales: 602.5 '000 Quintal (vs 597.0 Q2 FY25). H1 FY26 Sales: 1265.2 '000 Quintal (vs 1272.2 H1 FY25). * **Sugar Realization:** * Uttam H1 FY26: ₹4102/Qtls (vs ₹3934 H1 FY25). * Dwarikesh H1 FY26: ₹3962.7/Quintal (vs ₹3801.7 H1 FY25). * **Distillery Production/Sales:** * Uttam H1 FY26 Production: 412.37 Lakh BL. Sales: 440.78 Lakh BL. * Dwarikesh H1 FY26 Ethanol Production: 214.99 Lakh Liters. Industrial Alcohol Sales: 21.6 Mn L. * **Distillery Realization:** * Uttam H1 FY26: ₹55.01/Ltr. * Dwarikesh H1 FY26: ₹60.7/Ltr. * **Cane Crushing:** * Uttam SS 2024-25: 401.68 Lakh Qtls (projected). * Dwarikesh SS 2023-24: 325.36 Lakh Qtls.

**Asset Efficiency Metrics:** While specific asset turnover ratios are not provided, the continuous expansion of crushing, distillery, and power capacities by both companies indicates a focus on leveraging assets for higher production and diversified revenue streams. The significant increase in distillery production and power export suggests improved asset utilization in these segments when operational.

E. GROWTH DYNAMICS & DRIVERS

The sugar sector's growth is a blend of traditional sugar demand and the burgeoning opportunities in co-products, particularly ethanol.

**Historical Growth Trajectory (3-5 year view with specific rates):** * **Uttam Sugar:** * Revenue growth: H1 FY26 revenue grew 38.28% HoH, and Q2 FY26 revenue grew 45.07% QoQ. FY25 revenue was ₹1800.52 Cr. * Profitability growth: H1 FY26 PBT grew 369.60% HoH (from negative to positive), and Q2 FY26 PBT grew 113.49% QoQ (from negative to positive). * Specialty products: Tripled sales in branded specialty products, tenfold increase in invert sugar, and threefold increase in pharmaceutical sugar over the past six years. This indicates a strong historical growth trajectory in value-added segments. * Distillery production: H1 FY26 production (412.37 Lakh BL) more than doubled H1 FY25 (208.57 Lakh BL). * **Dwarikesh Sugar:** * Revenue growth: H1 FY26 revenue grew 10.91% HoH. FY25 revenue was ₹1365.32 Cr. * Distillery capacity: Stabilized at 130 KLPD (2019), 162.5 KLPD (2020), 175 KLPD (2021) at Dwarikesh Dham, and 162.5 KLPD at Dwarikesh Nagar. This shows consistent capacity expansion over the last 5-6 years. * Ethanol production: H1 FY26 production (214.99 lakh liters) more than doubled H1 FY25 (98.07 lakh liters).

**Current Growth Rates and Acceleration/Deceleration:** * **Uttam Sugar:** Demonstrating significant acceleration in revenue and profitability growth in H1 FY26 compared to H1 FY25, despite operational challenges. This suggests strong underlying demand for its products and effective management. * **Dwarikesh Sugar:** Showing modest revenue growth in H1 FY26 but a deceleration in profitability, with worsening negative margins. This indicates that while sales volumes might be maintained, the cost structure or realization rates are under pressure.

**Volume vs Price Contribution to Growth:** * **Sugar:** Both companies saw an increase in average domestic sugar realization in H1 FY26, contributing to revenue growth. Uttam also reported higher sugar sales volumes (21.67 Lakh Qtls in H1 FY26 vs 17.30 Lakh Qtls in H1 FY25). Dwarikesh's sugar sales volume was largely flat (1265.2 '000 Quintal in H1 FY26 vs 1272.2 '000 Quintal in H1 FY25). Thus, for Uttam, both volume and price contributed to growth, while for Dwarikesh, price was the primary contributor to modest revenue growth in H1. * **Ethanol:** Both companies showed significant volume growth in distillery production and sales in H1 FY26. Realization rates were relatively stable for Dwarikesh and slightly down for Uttam. Therefore, volume growth is the primary driver for ethanol revenue.

**Organic vs Inorganic Growth Components:** * **Organic Growth:** Both companies are pursuing organic growth through capacity expansions (e.g., Uttam's second distillery, Dwarikesh's continuous distillery expansions) and product diversification (Uttam's specialty sugars). * **Inorganic Growth:** Uttam Sugar's acquisition of Uttam Distilleries Ltd. (UDL) in 2024 is a clear example of inorganic growth to expand distillery capacity.

**Geographic Expansion Opportunities and Progress:** The data primarily focuses on operations within Uttar Pradesh. No explicit mention of geographic expansion beyond this region. However, Uttam's e-commerce presence and supply to national hotel/cafe chains imply a pan-India market reach for its finished products.

**Product/Service Innovation Pipeline:** * **Uttam Sugar:** Continuous development and expansion of branded, specialty, pharma-grade, and invert sugars. Investment in potash manufacturing. * **Dwarikesh Sugar:** Focus on robust, early-maturing cane varieties with improved disease resistance.

**Adjacent Market Opportunities:** * **Ethanol:** The EBP program provides a significant and expanding adjacent market opportunity. The overwhelming response to OMCs' ethanol tender (1,776 crore liters offered against 1,050 crore liters invited) highlights the strong supply potential and demand. * **Power:** Cogeneration offers an adjacent market for surplus power. * **Potash:** Uttam's investment in potash manufacturing from spent wash is an example of leveraging by-products for new revenue streams in the fertilizer market.

**Customer Acquisition and Penetration Trends:** * **Uttam Sugar:** Expanding reach through e-commerce platforms (BlinkIt, Zepto, Amazon) and partnerships with premier hotel and cafe chains indicates efforts to acquire new customers and deepen penetration in B2C and premium B2B segments. * **Dwarikesh Sugar:** Focus on maintaining strong relationships with its large farmer base (1.54 lakhs) for consistent cane supply.

**Overall Growth Drivers:** 1. **Government Push for Ethanol Blending:** The EBP program is a major structural tailwind, driving investments and demand for ethanol. 2. **Capacity Expansions:** Both companies are actively expanding sugar, distillery, and power capacities to meet growing demand and diversify revenue. 3. **Product Diversification:** Uttam's success in specialty sugars demonstrates the potential for value-added products to drive higher margins and growth. 4. **Firm Domestic Sugar Prices:** Supported by steady demand, domestic sugar prices are expected to remain firm, aiding profitability. 5. **Agricultural Improvements:** Adoption of robust cane varieties and improved monsoon rainfall (anticipated for 2025/26) strengthen crop prospects and cane availability. 6. **E-commerce Penetration:** Uttam's presence on e-commerce platforms taps into modern retail channels.

F. RISK LANDSCAPE

The sugar sector is exposed to a multitude of risks, ranging from agricultural and climatic to policy and market-related factors.

**Industry-wide Systematic Risks:** * **Climatic Variability:** Dependence on monsoon rainfall for sugarcane cultivation. Adverse weather conditions (droughts, excessive rains) can impact cane yield and quality, leading to reduced crushing and recovery. * **Disease Outbreaks:** Red-rot infestation, as mentioned by Dwarikesh for the Co 0238 cane variety, can severely impact cane health and sugar recovery. * **Global Commodity Price Volatility:** International sugar prices are highly volatile. While domestic prices are somewhat insulated, sharp declines in global prices (raw sugar below 15 cents/pound, white sugar around US$ 420/MT) can affect export opportunities and indirectly influence domestic sentiment. S&P Global projects a global surplus for 2025/26 and 2026/27, indicating potential downward pressure.

**Cyclicality and Economic Sensitivity:** The sugar industry is highly cyclical, primarily driven by the sugarcane crop cycle (which is annual) and government policies. Economic downturns can affect discretionary spending on certain sugar-containing products, but basic sugar consumption remains relatively inelastic.

**Regulatory and Policy Risks by Geography:** * **Sugarcane Pricing:** Government-mandated FRP/SAP for sugarcane directly impacts raw material costs for mills. Any upward revision without corresponding increases in sugar prices can squeeze margins. * **Ethanol Pricing:** Lack of timely revision in ethanol prices (especially for sugarcane juice and B-heavy molasses) is a significant risk, as highlighted by Dwarikesh. The policy environment increasingly favoring grain-based ethanol could shift demand away from sugar-based ethanol. * **Sugar Export Policy:** Policy clarity on potential resumption of sugar exports is crucial for efficient inventory management. Restrictions on exports can lead to domestic oversupply and price depression. * **Environmental Regulations:** Stricter environmental norms for distilleries and sugar mills (e.g., effluent treatment, emissions) can lead to increased compliance costs.

**Technology Disruption Threats:** While not explicitly mentioned, advancements in alternative sweeteners or sugar substitutes could pose a long-term threat. However, the current focus is more on process technology improvements and diversification into bio-fuels.

**ESG and Sustainability Challenges:** * **Water Usage:** Sugarcane is a water-intensive crop, posing sustainability challenges in water-stressed regions. * **Waste Management:** Efficient management of by-products like spent wash and bagasse is crucial. Investments in biomethanation and potash manufacturing (Dwarikesh, Uttam) address this. * **Carbon Footprint:** The industry is under pressure to reduce its carbon footprint, with ethanol production contributing to this goal by replacing fossil fuels.

**Supply Chain Vulnerabilities:** * **Cane Availability:** Reduced cane availability due to adverse weather, disease, or farmer shifting to other crops directly impacts crushing volumes. UP sugar production decline in 2024-25 (9.3 million MT) due to reduced cane availability is a recent example. * **Logistics Disruptions:** Transport issues for cane or finished products can affect operations and sales.

**Competitive Threats (New Entrants, Substitutes):** * **Intra-industry Competition:** Intense competition among existing mills for cane and market share. * **Grain-based Ethanol:** Policy preference for grain-based ethanol poses a competitive threat to sugar-based ethanol producers.

**Customer Concentration Risks:** For ethanol, OMCs represent a concentrated customer base, giving them significant bargaining power over pricing.

**Specific Risks/Challenges Highlighted for H1 FY26:** Both Uttam and Dwarikesh faced severe operational challenges in H1 FY26: * **Complete absence of production at both sugar units and distilleries during Q2.** * **Negligible crushing operations and disrupted distillery activities during H1.** * **Un-absorption of overhead costs due to curtailed operational activity.** * **Adverse impact from sale of high-valued opening inventory (higher carrying cost, lower contribution).** * **Early closure of season impacting power revenue (Dwarikesh).**

These factors collectively led to significant financial pressure and negative profitability for Dwarikesh, and suppressed profitability for Uttam, despite its year-on-year improvement.

G. CAPITAL ALLOCATION & INVESTOR RETURNS

Capital allocation in the sugar sector is heavily skewed towards capacity expansion and modernization, particularly in the high-growth ethanol segment.

**Capex Trends and Requirements (Growth vs Maintenance):** Both companies demonstrate a strong trend of continuous capital expenditure for growth: * **Uttam Sugar:** Significant investments in 2021 (Incineration Boiler, 50 KLPD Distillery, 50 TPD Potash plant), 2022 (200 TPD Potash plant), and 2024 (UDL acquisition for 40 KLPD). These are primarily growth capex aimed at expanding capacity and diversifying revenue streams. * **Dwarikesh Sugar:** A long history of growth capex, including increasing crushing capacity from 6,500 TCD to 21,500 TCD, cogeneration from 17 MW to 94 MW, and distillery from 30,000 LPD to 337.5 KLPD. Recent distillery expansions (100 KLPD, 130 KLPD, 162.5 KLPD, 175 KLPD) are significant growth investments. The sector requires ongoing maintenance capex to keep plants operational and efficient, though specific figures are not provided.

**R&D Investment Levels as % of Revenue:** Explicit R&D investment figures are not provided. However, efforts in "varietal development" (Dwarikesh) and "product innovation" (Uttam's specialty sugars) imply internal R&D or collaboration with agricultural research institutions.

**Dividend Policies and Payout Ratios:** No information on dividend policies or payout ratios is provided in the extracted data.

**Share Buyback Programs:** No information on share buyback programs is provided.

**M&A Activity and Strategy:** Uttam Sugar's acquisition of Uttam Distilleries Ltd. (UDL) in 2024 indicates a strategy of inorganic growth to quickly expand distillery capacity and consolidate market position in the ethanol segment.

**Cash Generation and Free Cash Flow Profiles:** The negative profitability reported by Dwarikesh and the thin margins for Uttam in H1 FY26 suggest that cash generation during the lean season can be challenging. However, the full FY25 results for both companies showed positive PAT, indicating cash generation during the crushing season. The capital-intensive nature of the business means that a significant portion of operating cash flow might be reinvested into capex.

**Capital Efficiency Improvements:** * **Diversification:** Investing in ethanol and power generation improves capital efficiency by utilizing by-products and creating additional revenue streams from the same raw material (sugarcane). * **Operational Optimization:** Dwarikesh's history of debottlenecking and right-sizing plants aims to improve asset utilization and capital efficiency. * **Value-added Products:** Uttam's focus on specialty sugars can lead to higher revenue per unit of sugar produced, improving capital efficiency.

H. FUTURE OUTLOOK & PROJECTIONS

The future outlook for the sugar sector is a mix of challenges and significant opportunities, primarily driven by the ethanol blending program and domestic demand dynamics.

**Industry Growth Projections (with timeframes):** * **Domestic Sugar Demand:** Expected to remain firm, supporting domestic prices (approaching ₹4,100 per quintal, as per Dwarikesh). * **UP Sugar Production:** Anticipated to improve to 10.3 million MT for 2025-26, up from 9.3 million MT in 2024-25, driven by better cane availability and recovery. * **Ethanol Blending Program:** The overwhelming response to OMCs' ethanol tender (1,776 crore liters offered against 1,050 crore liters invited) indicates strong future demand and supply potential for ethanol. The government's target of 20% ethanol blending by 2025 (E20) continues to be a major growth driver. * **Global Market:** S&P Global projects a global sugar surplus for 2025/26 and 2026/27, which could keep international prices subdued. This might limit export opportunities for Indian mills unless specific government policies are in place.

**Management Guidance Across Companies:** * **Dwarikesh Sugar:** * **Crushing Operations (SS 2025-26):** Expected to commence on 7th November 2025 at DN and DP units (Bijnor district) and on 10th November 2025 at DD unit (Bareilly district). * **Optimism for Forthcoming Season:** Management is "optimistic about the forthcoming season, with expectations of improved crushing volumes and a more diversified varietal mix." * **Operational Improvements:** Anticipates "meaningful improvements in crushing performance and sugar recovery, supporting overall operational efficiency." * **Cost Control:** "Steadfast commitment to continually enhance operational efficiencies and maintain rigorous cost controls." * **Policy Advocacy:** Continues to advocate for timely policy clarity on potential resumption of sugar exports and revision of ethanol prices.

• **Uttam Sugar:** While no explicit forward-looking "guidance" is provided, the company's strategic initiatives (capacity expansions, UDL acquisition, focus on specialty products) and historical growth in these segments imply an expectation of continued growth and improved performance. The strong H1 FY26 results, despite operational challenges, suggest confidence in their strategy.

**Emerging Opportunities and Whitespace:** * **Ethanol Diversification:** Continued expansion into ethanol, including exploring new feedstocks (if policy permits) and optimizing production from existing feedstocks. * **Specialty and Value-added Products:** Further penetration into pharmaceutical, food processing, and B2C segments with differentiated sugar products. * **By-product Monetization:** Expanding potash manufacturing and exploring other value-added products from waste streams. * **Renewable Energy:** Increased power generation and export from cogeneration plants. * **Digitalization:** Leveraging e-commerce platforms for wider market reach (as seen with Uttam).

**Transformation Themes and Inflection Points:** * **Ethanol Blending Mandate:** The EBP program is a major transformation theme, shifting the industry from a sugar-centric model to a sugar-ethanol integrated model. Achievement of E20 targets will be a significant inflection point. * **Sustainability:** Increasing focus on sustainable practices, including water conservation, waste utilization, and reducing carbon footprint. * **Value Chain Integration:** Mills are moving towards greater integration, from cane procurement to diversified product manufacturing and direct market access.

**Long-term Structural Trends (5-10 year view):** * **Increased Integration:** Sugar mills will likely become more integrated bio-refineries, producing sugar, ethanol, power, and other chemicals/fertilizers. * **Policy Support for Biofuels:** Continued government support for biofuels is expected, driving long-term demand for ethanol. * **Premiumization:** Growing demand for specialty and branded sugar products in both industrial and consumer segments. * **Technological Advancement:** Adoption of advanced farming techniques, cane varieties, and processing technologies to improve efficiency and recovery.

**Potential Disruptions on the Horizon:** * **Climate Change Impacts:** More frequent and intense extreme weather events could severely impact sugarcane cultivation. * **Policy Shifts:** Any significant changes in government policies regarding cane pricing, ethanol pricing, or export/import regulations could disrupt the industry. * **Global Market Dynamics:** Prolonged periods of global sugar surplus and low international prices could put pressure on domestic prices and profitability if export channels are restricted.

**Expected Margin Evolution:** As the industry diversifies into higher-margin products like specialty sugars and stable-revenue streams like ethanol (assuming favorable pricing policies), overall industry margins are expected to stabilize and potentially improve over the long term, reducing the extreme cyclicality associated with commodity sugar. However, the short-term impact of unabsorbed overheads during the lean season will continue to be a factor.

I. COMPANY-BY-COMPANY PROFILES

Uttam Sugar Mills Limited

**Company Name and Brief Description:** Uttam Sugar Mills Limited is an integrated sugar manufacturer in India, involved in the production of sugar, ethanol, and power. The company has strategically diversified its product portfolio to include branded and specialty sugars, pharma-grade sugar, and invert sugar, catering to a wide range of B2B and B2C customers. It also has a significant presence in the ethanol and power cogeneration segments, with recent expansions into potash manufacturing.

**Scale Metrics (Revenue, Capacity, Market Share):** * **Total Revenue (FY25 Standalone):** ₹1800.52 Cr * **Total Revenue (H1 FY26 Standalone):** ₹1166.84 Cr * **Sugarcane Crushing Capacity:** 27,000 TCD (Libberheri: 7000, Barkatpur: 8500, Shermau: 6000, Khaikheri: 5500) * **Distillery Capacity:** 350 KLPD (Libberheri: 62, Barkatpur: 288), plus 40 KLPD from UDL acquisition. * **Power Capacity:** 122 MW (Libberheri: 29, Barkatpur: 53, Shermau: 25, Khaikheri: 15) * **Market Position:** Customer-centric approach, diversified product range for B2B and B2C, supply chain to food, pharma, bakeries, distilleries, presence on e-commerce (BlinkIt, Zepto, Amazon), associated with premier hotel and cafe chains.

**Financial Performance Summary (Growth, Margins, Returns):** * **Q2 FY26 (Standalone):** * Revenue: ₹561.27 Cr (+45.07% QoQ) * EBITDA: ₹24.92 Cr (+420.25% QoQ), Margin: 4.44% * PBT: ₹2.34 Cr (+113.49% QoQ, from negative to positive), Margin: 0.42% * PAT: ₹1.48 Cr (+109.47% QoQ, from negative to positive), Margin: 0.26% * EPS: ₹0.39 (vs -₹4.10 in Q2 FY25) * **H1 FY26 (Standalone):** * Revenue: ₹1166.84 Cr (+38.28% HoH) * EBITDA: ₹76.53 Cr (+77.60% HoH), Margin: 6.56% * PBT: ₹23.59 Cr (+369.60% HoH, from negative to positive), Margin: 2.02% * PAT: ₹17.44 Cr (+289.57% HoH, from negative to positive), Margin: 1.49% * EPS: ₹4.57 (vs -₹2.41 in H1 FY25) * **FY25 (Standalone):** * Revenue: ₹1800.52 Cr * EBITDA: ₹222.32 Cr, Margin: 12.35% * PAT: ₹91.23 Cr, Margin: 5.07% * EPS: ₹23.92 * **Shareholding:** Promoter Holding: 74.39%, Public Holding: 25.61% (Institution: 0.07%, Public ex-Institution: 25.54%)

**Strategic Priorities and Focus Areas:** * **Diversification:** Expanding product portfolio into branded, specialty, pharma-grade, and invert sugars to capture higher-value segments. * **Ethanol Expansion:** Continuous increase in distillery capacity to leverage the government's EBP program. * **By-product Utilization:** Investment in potash manufacturing to create additional revenue streams and improve sustainability. * **Market Reach:** Strengthening presence in B2C through e-commerce and B2B through strategic partnerships.

**Competitive Advantages and Positioning:** * **Value-added Product Leader:** Strong growth in specialty sugar segments (tripled sales in branded specialty, tenfold in invert, threefold in pharma sugar over six years). * **Integrated Operations:** Comprehensive facilities for sugar, ethanol, power, and potash. * **Strong Market Presence:** Established supply chain to diverse industrial clients and growing presence in modern retail/e-commerce. * **Robust Financial Turnaround:** Demonstrated significant improvement in profitability in H1 FY26 despite industry-wide operational challenges.

**Key Metrics and KPIs Specific to the Company:** * **Sugar Production (H1 FY26):** 2.94 Lakh Qtls * **Sugar Sales (H1 FY26):** 21.67 Lakh Qtls * **Sugar Realisation (H1 FY26):** ₹4102 per Qtls * **Distillery Production (H1 FY26):** 412.37 Lakh BL * **Distillery Sale (H1 FY26):** 440.78 Lakh BL * **Distillery Realisation (H1 FY26):** ₹55.01 per Ltr * **Power Export (H1 FY26):** 97.79 Lakh KWH * **Branded/Speciality Division Average Sales/Per Month (2025-26 up to Oct):** 59764 Qtls (showing consistent growth)

**Management Outlook and Guidance:** Not explicitly stated as "guidance" but the company's strategic initiatives and capacity expansions (e.g., UDL acquisition in 2024) indicate a positive outlook and commitment to growth in diversified segments.

**Recent Developments and Initiatives:** * 2021: Incineration Boiler at Barkatpur, 50 KLPD Distillery and Potash plant at Libberheri. * 2022: 200 TPD Potash plant at Barkatpur. * 2024: Acquisition of Uttam Distilleries Ltd. (UDL) adding 40 KLPD capacity.

Dwarikesh Sugar Industries Limited

**Company Name and Brief Description:** Dwarikesh Sugar Industries Limited is a prominent sugar manufacturer in Uttar Pradesh, India. The company operates three integrated plants producing sugar, power through cogeneration, and ethanol. It has a long history of capacity expansion and operational optimization, with a strong focus on the ethanol segment as a key growth driver.

**Scale Metrics (Revenue, Capacity, Market Share):** * **Total Revenue (FY25 Standalone):** ₹1365.32 Cr * **Total Revenue (H1 FY26 Standalone):** ₹654.20 Cr * **Sugarcane Crushing Capacity:** 21,500 TCD (Dwarikesh Nagar: 6500, Dwarikesh Puram: 7500, Dwarikesh Dham: 7500) * **Distillery Capacity:** 337.5 KLPD (Dwarikesh Nagar: 162.5, Dwarikesh Dham: 175) * **Power Capacity:** 94 MW (Dwarikesh Nagar: 20, Dwarikesh Puram: 33, Dwarikesh Dham: 41), with ~54 MW surplus for export. * **Market Position:** All 3 plants in Uttar Pradesh, with strategic locations in Bijnor and Bareilly districts, providing access to fertile cane-producing areas and major consuming markets. Strong network with nearly 1.54 lakh farmers.

**Financial Performance Summary (Growth, Margins, Returns):** * **Q2 FY26 (Standalone):** * Revenue: ₹248.23 Cr (flat QoQ) * EBITDA: (₹38.95) Cr (deteriorated QoQ), Margin: -15.8% * PAT: (₹32.62) Cr (deteriorated QoQ), Margin: -13.3% * EPS: (₹1.76) (vs -₹1.29 in Q2 FY25) * **H1 FY26 (Standalone):** * Revenue: ₹654.20 Cr (+10.91% HoH) * EBITDA: (₹34.52) Cr (deteriorated HoH), Margin: -5.3% * PAT: (₹42.01) Cr (deteriorated HoH), Margin: -6.4% * EPS: (₹2.27) (vs -₹1.82 in H1 FY25) * **FY25 (Standalone):** * Revenue: ₹1365.32 Cr * EBITDA: ₹119.91 Cr, Margin: 8.78% * PAT: ₹23.34 Cr, Margin: 1.71% * EPS: ₹1.26

**Strategic Priorities and Focus Areas:** * **Ethanol Expansion:** Continuous increase in distillery capacity to capitalize on the EBP program. * **Operational Efficiency:** Optimizing capacity utilization and maintaining rigorous cost controls. * **Cane Development:** Efforts in crop protection and varietal development to ensure consistent and high-quality cane supply. * **Policy Advocacy:** Engaging with policymakers for timely ethanol price revisions and clarity on sugar export policies.

**Competitive Advantages and Positioning:** * **Prime Geographic Locations:** Strategic placement of plants in UP's fertile belt ensures reliable cane procurement. * **Extensive Farmer Network:** Strong relationships with a large base of farmers. * **Scale in Ethanol Production:** Substantial and growing distillery capacity positions it well for the biofuel market. * **Long Operational History:** Decades of experience in sugar, power, and distillery operations.

**Key Metrics and KPIs Specific to the Company:** * **Sugar Sales (H1 FY26):** 1265.2 '000 Quintal * **Average Domestic Sugar Realization (H1 FY26):** ₹3962.7 per Quintal * **Ethanol Production (H1 FY26):** 214.99 Lakh Liters (across both distilleries) * **Industrial Alcohol Sold (H1 FY26):** 21.6 Mn L * **Average Industrial Alcohol Realization (H1 FY26):** ₹60.7 per Ltr * **Power Generated (Q2 FY26):** 15.4 Mn Unit * **Power Exported (Q2 FY26):** 1.6 Mn Unit * **Average Power Realization (Q2 FY26):** ₹2.8 per Unit

**Management Outlook and Guidance:** * Optimistic about SS 2025-26 with expected improvements in crushing volumes and sugar recovery. * Crushing operations to commence early November 2025. * Committed to enhancing operational efficiencies and cost controls. * Highlights risks from global sugar surplus, lack of ethanol price revision, and policy shifts towards grain-based ethanol.

**Recent Developments and Initiatives:** * 2017-2021: Gradual expansion of distillery capacity from 100 KLPD to 337.5 KLPD. * Continuous efforts in crop protection and varietal development.

J. TABLES

**Table 1: Uttam Sugar Mills Limited - Standalone Financial Performance Summary**

| Metric | Q2 FY26 | Q2 FY25 | H1 FY26 | H1 FY25 | FY25 | | :---------------------- | :------------ | :------------- | :------------- | :------------- | :------------- | | Total Revenue (₹ Cr) | 561.27 | 386.88 | 1166.84 | 843.85 | 1800.52 | | EBITDA (₹ Cr) | 24.92 | 4.79 | 76.53 | 43.09 | 222.32 | | Depreciation (₹ Cr) | 11.46 | 11.00 | 22.86 | 22.27 | 44.60 | | EBIT (₹ Cr) | 13.46 | (6.21) | 53.67 | 20.82 | 177.72 | | Interest (₹ Cr) | 11.12 | 11.13 | 30.08 | 29.57 | 53.88 | | PBT (₹ Cr) | 2.34 | (17.34) | 23.59 | (8.75) | 123.84 | | PAT (₹ Cr) | 1.48 | (15.63) | 17.44 | (9.20) | 91.23 | | Total Comprehensive Income (₹ Cr) | 2.42 | (15.75) | 18.62 | (8.70) | 90.41 | | EPS (*Not annualized) | 0.39 | (4.10) | 4.57 | (2.41) | 23.92 | | EBITDA Margin (%) | 4.44% | 1.24% | 6.56% | 5.11% | 12.35% | | PBT Margin (%) | 0.42% | -4.48% | 2.02% | -1.04% | 6.88% | | PAT Margin (%) | 0.26% | -4.04% | 1.49% | -1.09% | 5.07% |

**Table 2: Uttam Sugar Mills Limited - Standalone Growth Rates**

| Metric | Q2 FY26 QoQ % | H1 FY26 HoH % | | :---------------------- | :------------ | :------------ | | Revenue | 45.07% | 38.28% | | EBITDA | 420.25% | 77.60% | | PBT | 113.49% | 369.60% | | PAT | 109.47% | 289.57% |

**Table 3: Uttam Sugar Mills Limited - Consolidated Financial Performance Summary**

| Metric | Q2 FY26 | Q2 FY25 | H1 FY26 | H1 FY25 | FY25 | | :---------------------- | :------------ | :------------- | :------------- | :------------- | :------------- | | Total Revenue (₹ Cr) | 584.82 | 402.15 | 1214.78 | 859.12 | 1854.14 | | EBITDA (₹ Cr) | 26.21 | 4.50 | 77.84 | 42.80 | 221.23 | | Depreciation (₹ Cr) | 12.15 | 11.67 | 24.24 | 22.94 | 46.60 | | EBIT (₹ Cr) | 14.06 | (7.17) | 53.60 | 19.86 | 174.63 | | Interest (₹ Cr) | 12.40 | 11.70 | 32.55 | 30.14 | 56.63 | | PBT (₹ Cr) | 1.66 | (18.87) | 21.05 | (10.28) | 118.00 | | PAT (₹ Cr) | 0.98 | (14.75) | 15.51 | (8.32) | 85.80 | | Total Comprehensive Income (₹ Cr) | 1.92 | (14.27) | 16.70 | (7.83) | 84.98 | | EPS (*Not annualized) | 0.26 | (3.81) | 4.08 | (2.29) | 23.16 | | EBITDA Margin (%) | 4.48% | 1.12% | - | - | 11.93% | | PBT Margin (%) | 0.28% | -4.69% | - | - | 6.36% | | PAT Margin (%) | 0.17% | -3.67% | - | - | 4.63% |

**Table 4: Uttam Sugar Mills Limited - Operational Capacities**

| Unit | Sugarcane Crushing Capacity (TCD) | Distillery Capacity (KLPD) | Power Capacity (MW) | | :---------- | :-------------------------------- | :------------------------- | :------------------ | | Libberheri | 7000 | 62 | 29 | | Barkatpur | 8500 | 288 | 53 | | Shermau | 6000 | 0 | 25 | | Khaikheri | 5500 | 0 | 15 | | **Total** | **27000** | **350** (excl. 40 UDL) | **122** |

**Table 5: Uttam Sugar Mills Limited - Key Operational Metrics**

| Metric | H1 FY26 | H1 FY25 | FY25 | | :---------------------------- | :---------- | :---------- | :---------- | | Sugar Production (Lakh Qtls) | 2.94 | 1.52 | 34.69 | | Sugar Sales (Lakh Qtls) | 21.67 | 17.30 | 32.85 | | Sugar Realisation (Rs./Qtls) | 4102 | 3934 | 3984 | | Sugar Inventory (Lakh Qtls) | 6.64 | 7.75 | 25.37 | | Valuation Rate (Rs./Qtls) | 3539 | 3379 | 3578 | | Power Export (KWH in Lakhs) | 97.79 | 27.46 | 1045.80 | | Distillery Production (BL in Lakhs) | 412.37 | 208.57 | 665.58 | | Distillery Sale (BL in Lakhs) | 440.78 | 254.03 | 675.38 | | Distillery Realisation (Rs./Ltr) | 55.01 | 55.29 | 56.20 |

**Table 6: Uttam Sugar Mills Limited - Cane Crushing & Branded/Speciality Sales**

| Metric | SS 2021-22 | SS 2022-23 | SS 2023-24 | SS 2024-25 | 2025-26 (up to Oct 2025) | | :-------------------------------------- | :--------- | :--------- | :--------- | :--------- | :----------------------- | | Cane Crushing (Lakh Qtls) | 382.76 | 432.04 | 325.36 | 401.68 | - | | Branded/Speciality Sales/Month (Qtls) | 48893 | 51391 | 50996 | 51728 | 59764 |

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**Table 7: Dwarikesh Sugar Industries Limited - Standalone Financial Performance Summary**

| Metric | Q2 FY26 | Q2 FY25 | H1 FY26 | H1 FY25 | FY25 | | :---------------------------- | :------------ | :------------ | :------------ | :------------ | :------------- | | Total Income (INR Million) | 2,482.3 | 2,480.1 | 6,542.0 | 5,898.6 | 13,653.2 | | Revenue from Operations (INR Million) | 2,459.3 | 2,460.6 | 6,514.0 | 5,873.1 | 13,588.8 | | EBIDTA (INR Million) | -389.5 | -210.7 | -345.2 | -181.8 | 1,199.1 | | PAT (INR Million) | -326.2 | -240.0 | -420.1 | -337.2 | 233.4 | | EPS (INR) | -1.76 | -1.29 | -2.27 | -1.82 | 1.26 | | EBITDA Margin (%) | -15.8% | -8.6% | -5.3% | -3.1% | 8.78% | | PAT Margin (%) | -13.3% | -9.8% | -6.4% | -5.7% | 1.71% |

**Table 8: Dwarikesh Sugar Industries Limited - Operational Capacities**

| Unit | Sugarcane Crushing Capacity (TCD) | Power Capacity (MW) | Distillery Capacity (KLPD) | | :-------------- | :-------------------------------- | :------------------ | :------------------------- | | Dwarikesh Nagar | 6500 | 20 | 162.5 | | Dwarikesh Puram | 7500 | 33 | - | | Dwarikesh Dham | 7500 | 41 | 175 | | **Total** | **21500** | **94** | **337.5** |

**Table 9: Dwarikesh Sugar Industries Limited - Key Operational Metrics**

| Metric | Q2 FY26 | Q2 FY25 | H1 FY26 | H1 FY25 | | :------------------------------------ | :------ | :------ | :------ | :------ | | Sugar Sold ('000 Quintal) | 602.5 | 597.0 | 1265.2 | 1272.2 | | Average Domestic Sugar Realization (INR/Quintal) | 3963.4 | 3766.6 | 3962.7 | 3801.7 | | Power Generated (Mn Unit) | 15.4 | 7.2 | - | - | | Power Exported (Mn Unit) | 1.6 | 0.3 | - | - | | Average Power Realization (INR/Unit) | 2.8 | 3.5 | - | - | | Industrial Alcohol Sold (Mn L) | 0.0 | 3.2 | 21.6 | 15.5 | | Average Industrial Alcohol Realization (INR/L) | 0.0 | 60.7 | 60.7 | 60.7 | | Ethanol Production (Lakh Liters) | - | - | 214.99 | 98.07 |