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Kothari Sugars &Chem Overview

1. Business Overview

Kothari Sugars And Chemicals Ltd. is primarily engaged in the manufacturing of sugar. The company has diversified its operations to include an integrated value chain that processes sugarcane. Beyond sugar production, it operates a distillery for manufacturing ethanol and industrial alcohol from molasses (a byproduct of sugar), co-generates power from bagasse (another byproduct), and produces industrial chemicals. Its core business model focuses on leveraging byproducts to create additional revenue streams and enhance overall operational efficiency, reducing reliance solely on sugar price fluctuations.

2. Key Segments / Revenue Mix

The major business segments for Kothari Sugars And Chemicals Ltd. typically include:

Sugar: The primary segment, involving the crushing of sugarcane and production of various grades of sugar.

Distillery: Production of ethanol and industrial alcohol, primarily from molasses. This segment's contribution has been growing due to the government's ethanol blending program.

Co-generation: Generation and sale of electricity using bagasse. This segment provides energy cost savings and supplementary revenue.

Chemicals: Manufacturing and sale of various industrial chemicals, contributing to overall diversification.

While specific revenue percentages are not provided, sugar historically forms a significant portion, with distillery and co-generation segments increasingly contributing to the company's top line and profitability.

3. Industry & Positioning

The Indian sugar industry is highly regulated, cyclical, and largely dependent on monsoon patterns, sugarcane output, and government policies. It is characterized by numerous regional players rather than a few dominant national ones. Key factors include government-mandated sugarcane prices (FRP), minimum selling prices for sugar, and policies related to ethanol blending and international trade. Kothari Sugars And Chemicals Ltd. operates primarily in the southern Indian sugar belt (Tamil Nadu). It is an established regional player, known for its integrated operations that help mitigate some of the inherent cyclicality and risks of being a standalone sugar manufacturer, positioning it as a relatively diversified player within its regional market.

4. Competitive Advantage (Moat)

Kothari Sugars possesses certain competitive advantages:

Integrated Operations: The ability to convert sugarcane into sugar, molasses into ethanol, and bagasse into power provides multiple revenue streams and improves cost efficiency, reducing vulnerability to price swings in a single commodity.

Location & Raw Material Sourcing: Established presence and relationships with local sugarcane farmers in its operating region ensure a relatively consistent supply of raw material.

Moderate Entry Barriers: Setting up a sugar, distillery, or chemical plant requires substantial capital investment, technological know-how, and numerous regulatory approvals, making it challenging for new entrants.

Operational Scale (Regional): Within its specific geographic area, the company benefits from economies of scale in procurement, processing, and distribution.

5. Growth Drivers

Key factors that can drive growth for Kothari Sugars And Chemicals Ltd. over the next 3-5 years include:

Ethanol Blending Program (EBP): The Indian government's ambitious targets for increasing ethanol blending in petrol (E20 by 2025) will continue to drive demand and provide stable, often higher, margins for ethanol producers. Capacity expansion in distilleries will be a direct growth lever.

Stable Domestic Sugar Consumption: India's large and growing population ensures consistent domestic demand for sugar.

Improved Efficiency and Recovery Rates: Continuous improvements in sugar recovery rates from sugarcane and optimization of by-product utilization (e.g., enhanced power generation) can boost profitability.

Value-Added Products: Expansion or focus on higher-margin specialty chemicals or other value-added products could provide further diversification and growth.

6. Risks

Kothari Sugars faces several significant risks:

Monsoon Dependency & Sugarcane Availability: The sugar industry is agro-climatic dependent. Erratic monsoons, droughts, or pests can lead to sugarcane shortages, impacting crushing volumes and increasing raw material costs.

Government Policies & Regulations: The industry is heavily regulated. Changes in sugarcane pricing (FRP), minimum selling price (MSP) for sugar, export/import policies, and ethanol procurement prices/targets can significantly impact profitability and operational viability.

Commodity Price Volatility: Prices of sugar, ethanol, and chemicals are subject to global and domestic market fluctuations, which directly affect revenue and margins.

Working Capital & Debt Levels: Sugar mills typically require substantial working capital due to the seasonal nature of operations, making them sensitive to interest rate changes and access to financing.

Environmental Compliance: Stringent environmental regulations for sugar and distillery units can lead to increased capital expenditure and operational costs for compliance.

7. Management & Ownership

Kothari Sugars And Chemicals Ltd. is part of the C.M. Kothari Group, indicating it is a promoter-led company. In such structures, the promoter family typically holds a significant ownership stake, which generally aligns their interests with the long-term success of the business. Management quality in the sugar sector is crucial for navigating its cyclicality, managing farmer relationships for cane procurement, and effectively responding to evolving government policies and market dynamics. The company's long operating history suggests experienced leadership in the industry, though adaptability to new technologies and regulatory landscapes is vital.

8. Outlook

Kothari Sugars And Chemicals Ltd. operates in a sector with inherent cyclicality and regulatory sensitivity. Its integrated business model, encompassing sugar, distillery (ethanol), co-generation, and chemicals, offers a degree of resilience by diversifying revenue streams beyond pure sugar sales. The government's strong push for ethanol blending presents a significant tailwind for the distillery segment, providing a relatively stable and higher-margin growth avenue. However, the company remains highly exposed to the vagaries of monsoon, fluctuations in sugarcane availability and cost, and unpredictable shifts in government policies concerning sugar and ethanol. While stable domestic demand for sugar provides a baseline, sustained profitability and growth will depend on efficient operational management, prudent capacity expansion in value-added segments, and adept navigation of the complex regulatory and climatic risks inherent in the Indian sugar industry.

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Kothari Sugars &Chem Key Financials

Market Cap ₹206 Cr.

Stock P/E 19.8

P/B 0.7

Current Price ₹24.9

Book Value ₹ 35.7

Face Value 10

52W High ₹41.4

Dividend Yield 0%

52W Low ₹ 22.5

Kothari Sugars &Chem Share Price

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Volume
Price

Kothari Sugars &Chem Quarterly Price

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Kothari Sugars &Chem Peer Comparison

Kothari Sugars &Chem Quarterly Results

#(Fig in Cr.) Dec 2023 Mar 2024 Jun 2024 Sep 2024 Dec 2024 Mar 2025 Jun 2025 Sep 2025 Dec 2025 Mar 2026
Net Sales 132 94 90 102 83 36 67 68 70 42
Other Income 4 5 4 4 3 6 4 2 3 2
Total Income 136 100 94 105 86 42 71 70 73 44
Total Expenditure 133 91 89 91 79 39 66 76 76 45
Operating Profit 4 8 5 14 6 3 5 -6 -3 -1
Interest 0 1 2 1 0 1 2 1 1 1
Depreciation 4 4 4 4 4 4 4 4 4 4
Exceptional Income / Expenses 0 0 0 0 6 0 2 0 20 0
Profit Before Tax -0 4 -1 10 9 -1 2 -11 12 -6
Provision for Tax -1 -2 -0 3 3 -0 0 -4 0 -6
Profit After Tax 1 6 -1 6 5 -1 1 -7 12 1
Adjustments 0 0 0 0 -0 0 0 0 0 0
Profit After Adjustments 1 6 -1 6 5 -1 1 -7 12 1
Adjusted Earnings Per Share 0.1 0.7 -0.1 0.8 0.7 -0.1 0.2 -0.9 1.4 0.1

Kothari Sugars &Chem Profit & Loss

#(Fig in Cr.) Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025 TTM
Net Sales 340 247 317 287 332 353 419 423 610 503 310 247
Other Income 11 7 5 5 17 4 5 7 9 15 16 11
Total Income 351 253 322 292 350 357 424 430 619 518 326 258
Total Expenditure 331 229 280 259 302 325 387 374 549 458 298 263
Operating Profit 21 24 42 33 47 33 37 56 69 60 29 -5
Interest 5 7 8 6 7 7 5 4 4 4 4 5
Depreciation 16 15 15 14 13 13 14 14 14 14 15 16
Exceptional Income / Expenses 0 0 -6 -10 -5 6 5 1 4 0 6 22
Profit Before Tax -0 3 13 3 23 19 23 39 55 42 17 -3
Provision for Tax 4 2 2 2 10 -0 4 5 13 12 6 -10
Profit After Tax -5 1 10 0 13 19 19 34 42 29 10 7
Adjustments 0 0 0 0 0 0 1 -0 0 -0 0 0
Profit After Adjustments -5 1 10 0 13 19 20 34 42 29 11 7
Adjusted Earnings Per Share -0.5 0.1 1.3 0.1 1.5 2.3 2.3 4.1 5.1 3.6 1.3 0.8

Growth Rates

# 1 Year 3 Year 5 Year 10 Year
Sales CAGR -38% -10% -3% -1%
Operating Profit CAGR -52% -20% -3% 3%
PAT CAGR -66% -33% -12% 0%
# 1 Year 3 Year 5 Year 10 Year
Share Price CAGR -39% -13% -10% 5%
ROE Average 4% 11% 12% 8%
ROCE Average 6% 14% 14% 10%

Kothari Sugars &Chem Balance Sheet

#(Fig in Cr.) Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025
Shareholder's Funds 121 119 132 139 152 166 186 220 258 278 289
Minority's Interest 0 0 0 0 0 0 0 0 0 0 0
Borrowings 107 92 54 36 30 5 7 0 0 0 0
Other Non-Current Liabilities 32 30 30 28 33 30 29 28 32 37 36
Total Current Liabilities 98 127 164 166 176 172 117 146 143 168 124
Total Liabilities 358 368 380 370 391 373 340 394 432 483 450
Fixed Assets 209 195 190 177 166 171 161 152 151 163 149
Other Non-Current Assets 5 7 4 16 3 2 2 8 33 25 30
Total Current Assets 144 167 186 177 222 200 177 235 248 295 271
Total Assets 358 368 380 370 391 373 340 394 432 483 450

Kothari Sugars &Chem Cash Flow

#(Fig in Cr.) Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025
Opening Cash & Cash Equivalents 1 7 15 1 2 -73 -72 -21 -48 -37 -69
Cash Flow from Operating Activities -13 25 25 37 26 27 82 -3 45 16 52
Cash Flow from Investing Activities 1 4 -10 0 -11 3 -29 -13 -19 -36 -28
Cash Flow from Financing Activities 18 -22 -28 -36 -10 -30 -1 -11 -15 -12 -4
Net Cash Inflow / Outflow 6 8 -14 1 5 0 51 -27 11 -32 21
Closing Cash & Cash Equivalent 7 15 1 2 7 -72 -21 -48 -37 -69 -48

Kothari Sugars &Chem Ratios

# Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025
Earnings Per Share (Rs) -0.55 0.14 1.26 0.06 1.53 2.34 2.29 4.11 5.06 3.56 1.26
CEPS(Rs) 1.38 1.91 3.03 1.73 3.08 3.91 3.96 5.81 6.75 5.28 3.03
DPS(Rs) 0 0 0.5 0 0.5 0 0 0 1 0.5 0
Book NAV/Share(Rs) 14.08 14.22 15.94 16.81 18.35 20.09 22.47 26.54 31.07 33.6 34.9
Core EBITDA Margin(%) 2.7 7.01 11.03 9.64 9.02 8.01 7.78 11.71 9.93 8.81 3.95
EBIT Margin(%) 1.36 3.88 6.28 3.16 8.99 7.38 6.8 10.25 9.62 9.03 6.55
Pre Tax Margin(%) -0.1 1.09 3.82 0.92 6.87 5.39 5.59 9.28 8.98 8.33 5.4
PAT Margin (%) -1.31 0.46 3.18 0.17 3.83 5.5 4.53 8.03 6.87 5.86 3.36
Cash Profit Margin (%) 3.29 6.22 7.62 4.94 7.68 9.18 7.82 11.35 9.17 8.7 8.08
ROA(%) -1.22 0.32 2.8 0.13 3.34 5.08 5.33 9.27 10.15 6.45 2.24
ROE(%) -3.82 1 8.39 0.35 8.72 12.19 10.78 16.75 17.56 11 3.67
ROCE(%) 1.73 3.41 7.23 3.41 11.33 10.06 12.09 17.45 20.57 14.13 5.93
Receivable days 11.25 12.54 12.89 20.02 19.31 23.09 21.07 19.77 15.86 18.16 22.95
Inventory Days 105.87 154.74 144.07 170.79 146.14 135.86 91.2 91.85 78.76 110 155.72
Payable days 56.81 64.18 69.28 115.63 123.6 115.12 93.49 103.35 70.26 92.98 126.95
PER(x) 0 75.35 10.71 205.45 6.2 3.65 11.96 8.66 6.9 14.46 25.69
Price/Book(x) 0.44 0.75 0.85 0.71 0.52 0.43 1.22 1.34 1.12 1.53 0.93
Dividend Yield(%) 0 0 3.69 0 5.26 0 0 0 2.87 0.97 0
EV/Net Sales(x) 0.61 1.01 0.81 0.75 0.56 0.44 0.63 0.83 0.54 0.99 1.02
EV/Core EBITDA(x) 10.08 10.16 6.14 6.5 3.95 4.71 7.04 6.2 4.72 8.3 11.03
Net Sales Growth(%) 5.11 -27.47 28.46 -9.42 15.79 6.2 18.9 0.95 44.04 -17.58 -38.33
EBIT Growth(%) -67.44 107.91 109.93 -55.68 225.71 -12.8 9.64 52.25 35.16 -22.64 -55.24
PAT Growth(%) -262.85 125.94 790.58 -95.42 2547.45 52.76 -2.05 78.94 23.19 -29.65 -64.65
EPS Growth(%) -262.83 125.93 790.7 -95.42 2547.39 52.76 -2.05 78.94 23.19 -29.65 -64.65
Debt/Equity(x) 1.34 1.48 1.1 0.86 0.76 0.5 0.19 0.25 0.15 0.25 0.17
Current Ratio(x) 1.46 1.31 1.14 1.07 1.26 1.16 1.51 1.61 1.74 1.76 2.18
Quick Ratio(x) 0.45 0.4 0.26 0.3 0.47 0.44 0.78 0.74 0.79 0.76 1.4
Interest Cover(x) 0.93 1.39 2.55 1.41 4.24 3.71 5.6 10.6 15.09 12.89 5.69
Total Debt/Mcap(x) 3.18 1.98 1.3 1.22 1.47 1.18 0.16 0.19 0.13 0.16 0.18

Kothari Sugars &Chem Shareholding Pattern

# Dec 2023 Mar 2024 Jun 2024 Sep 2024 Dec 2024 Mar 2025 Jun 2025 Sep 2025 Dec 2025 Mar 2026
Promoter 73.53 73.53 73.53 73.53 73.53 73.53 73.53 73.53 73.53 73.53
FII 0.66 0.66 0.65 0.62 0.6 0.56 0.59 0.22 0.17 0.16
DII 0.84 0.69 0.67 0.67 0.67 0.67 0.65 0.65 0.63 0.5
Public 24.97 25.12 25.14 25.18 25.2 25.24 25.23 25.61 25.67 25.8
Others 0 0 0 0 0 0 0 0 0 0
Total 100 100 100 100 100 100 100 100 100 100

Kothari Sugars &Chem News

Kothari Sugars &Chem Pros & Cons

Pros

  • Stock is trading at 0.7 times its book value
  • Company is almost debt free.

Cons

  • Company has a low return on equity of 11% over the last 3 years.
  • Debtor days have increased from 92.98 to 126.95days.
  • The company has delivered a poor profit growth of -12% over past five years.
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