Gulshan Polyols Ltd
Gulshan Polyols Ltd, with over 30 years of expertise, specializes in Ethanol/Bio-fuel, Grain, and Mineral-based products, and is expanding its operations, especially in the Indian bio-ethanol sector, under its commitment to sustainable growth themed “Expanding Potential”.
MCap: Rs 1,308
Sales (TTM): Rs 1,234 Cr
Sales:MCap 0.95 times
CMP: Rs 210
PE: 39.60 times
PB: 2.26 times
BV: Rs 92.80
EPS: 5.29
ROCE: 8.68%
ROE: 7.81%
Sales Growth 3 yrs CAGR: 23.90 %
Profit Growth 3 yrs CAGR: 28.20 %
Borrowings: Rs 358 Cr & Reserve and Capital : Rs 579 Cr.
Financial Performance:
Q2 FY23 income from operations was ₹277.38 crores, stable due to high capacity utilization and strong product demand.
Input costs increased by 13.2% YoY, mainly due to higher raw material and power costs.
EBITDA for the quarter was ₹20 crores (7.3%), net profit ₹9 crores with a PAT margin of 3.3%.
H1 FY23 revenue was ₹548 crores, up 6% YoY.
The company targets a sustainable margin of 10-12%.
Expansion Plans:
Grain Processing Segment:
Products: This segment includes sorbitol, maize starch, liquid glucose, fructose syrup, and other starch derivatives such as Malto Dextrine and Dextrose Monohydrate, along with agro-based animal feed.
Facilities and Capacities: The company has production facilities in Muzaffarnagar, Uttar Pradesh, and Bharuch, Gujarat. Muzaffarnagar specializes in producing maize starch (70,000 metric tons per annum) and fructose syrup (36,000 metric tons per annum), while the Bharuch facility focuses on sorbitol production (72,000 metric tons per annum).
Capacity Utilization and Expansion: The combined capacities in this segment are about 150,000 metric tons per annum. Currently operating at full capacity, the company plans a 20% capacity expansion to meet growing domestic and export demand.
Customer Base: The segment serves a strong customer base, including FMCG companies like Lever, Dabur, Asian Paint, and Patanjali. The products are also exported to over 35 countries. Starch, particularly, sees robust demand from the semi-craft paper industry, driven by e-commerce growth.
Ethanol and Distillery Segment:
Current Operations: The company operates a 60 KLPD grain-based ethanol plant and distillery in Chhindwara, Madhya Pradesh, running at 110% capacity utilization. This facility was set up in 2020.
Expansion Plans: As part of the government’s Ethanol Blended Petrol Program (EBPP), the company plans to enhance capacity from 60KLPD to 500 KLPD by Quarter 4 of the current financial year. Additionally, a new 250 KLPD grain-based ethanol plant is being set up in Goalpara, Assam, expected to be operational by FY25.
Mineral Processing Segment:
Products: This segment produces various grades of calcium carbonate, including precipitated and brown calcium carbonate.
Applications: The calcium carbonate products are primarily used in the paper and PVC industries.
Contribution: Though smaller compared to the other segments, this segment makes a significant contribution to the business.
CAPEX and Funding:
Spent INR 250 crore of a total INR 600 crore CAPEX, with INR 350 crore pending.
Ethanol expansion funded through term loans, QIP, and internal accruals.
Eligible for Production Linked Fiscal Assistance for Greenfield ethanol plants in Madhya Pradesh and Assam.
ISS approval from DFPD for bank funding reduces funding costs.
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