Dhampur Bio’s decision to postpone the ethanol plant is the right strategy as Govt is not increasing the ethanol prices and sugar prices are going up. As DBOL cane availability is increasing they have increased cane crushing capacity for making sugar. They are sitting on surplus cash as ethanol capex was postponed.
Their sugar recovery rate will be better (like in the case of Balarampur). DBOL will be the best performing sugar company due to the right capex and cane strategy.
Sugar companies in general will produce less ethanol this year. DBOL revenue from ethanol will be <10% this year.
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