Avadh Sugar reports Q4FY22 numbersAVADHSUGAR - 619 Change: 7.85 (1.29 %)
News: Avadh Sugar reported Q4FY22 results with revenue de-growth of 8.7% and earnings de-growth of 9.3%. The company received 0.98 lakh tonnes of domestic quota for the quarter as against 1.2 lakh tonnes in corresponding quarter. Distillery sales was up by 44.5% led by increase in ethanol volumes along with higher realisation. Distillery sales was up by 44.5% led by increase in ethanol volumes along with higher realisation and Net profit dipped by 9.3% to Rs 51.3 crore. On a full year basis, net profit increased by 60.3% to Rs 124.4 crore. The company declared a Rs 10/share dividend for the year.
Views: Sugar industry has been able to reduce country wise sugar inventories from 14.5 million tonnes to 8.2 million tonnes in last three years. Despite significant increase in sugar production of 35.5 million tonnes in current season, inventories would further come down by 1-15. million tonnes by September 2022 mainly due to record 9.5 million tonnes of exports. With the increasing sugarcane diversion towards ethanol & aggrieve exports due to favourable higher global sugar price, sugar prices are expected to remain benign going forward. Further, high sugar production is an opportunity to increase the blending target beyond 20% in future. Avadh sugar is one of the most attractively valued companies in sugar sector given new distillery capacity & considerable reduction in working capital debt would boost the earnings in next two years. We remain positive on sugar sector in general & Avadh Sugar in particular.