Triveni Engineering and Industries Ltd (TEIL) has reported a 37 per cent rise in its consolidated net profit to Rs 130.12 crore for the December 2021 quarter on higher revenue.
The net profit of the company, which is into sugar and engineering businesses, stood at Rs 94.66 crore in the year-ago period.
The total income also increased to Rs 1,242.40 crore in the third quarter of this fiscal from Rs 1,130.73 crore in the corresponding period of the previous year, according to a regulatory filing.
It has an order book of Rs 1,808.39 crore for combined engineering businesses. The company's consolidated debt stood at Rs 592 crore as of December 31, 2021.
In a statement, TEIL's CMD Dhruv M Sawhney said, “The increase in cane prices by Rs 250 per tonne for the sugar Season 2021-22 will be largely offset by the recent increase in sugar prices".
The estimated stocks of 6.65 million tonnes at the end of the current sugar season in September are likely to support the domestic sugar prices, he added.
Sawhney said the continuance of exports and/or substantial diversion of sugar for ethanol will be key to maintaining the sugar prices.
"We hope that the Government addresses the long-pending increase in Minimum Selling Price (MSP) of sugar to maintain the viability of sugar mills and to preserve their cane price paying capacity," he said.
On the pricing side, even though sugar prices have come off their recent peaks both in domestic and global markets, they are higher than last year.
With a global deficit anticipated yet again in the 2021-22 season, he expects international sugar prices to stay firm.
Without export assistance, Sawhney said, northern millers might not participate in exports unless the international prices improve meaningfully from current levels.
However, he said, exports might continue to be viable from Maharashtra and other coastal regions.
"The distillery segment continued its strong performance driven by higher sales volumes and realisation prices due to improved product mix," he said.
Sawhney said the company expects the first tranche of 220-kilo litre per day (KLPD) distillery expansion of its 340 KLPD growth plans to commence by March 2022.
The balance of 120 KLPD is expected to be operational around Q1 of FY23.
"The company's overall capacity after both expansions will more than double from current levels of 320 KLPD to 660 KLPD," he said.
Sawhney said the engineering businesses have largely overcome the impact of COVID on their operations and those of customers and has put up a much better performance in terms of turnover and profitability.
"A broad-based economic recovery, which is already underway, is likely to keep the demand strong for these businesses," he said.
Sawhney said the power transmission business was poised for strong growth in the coming years across the gamut of services, such as defence, gears and built to print.
"The company has a strong order pipeline in its water business and we continue to bid for many new projects to improve it further," he said.
TEIL is a diversified industrial conglomerate having a major presence in sugar and engineering.
It currently has seven sugar mills in Uttar Pradesh.
While the company's power transmission (Gears) manufacturing facility is located at Mysuru, the water and wastewater treatment business is in Noida.
The company currently operates 6 co-generation power plants located across five sugar units and two molasses-based distilleries in Uttar Pradesh, located at Muzaffarnagar and Sabitgarh.
The company manufactures Indian Made Indian Liquor (IMIL) at its Muzaffarnagar distillery.