MUMBAI - Dwarikesh Sugar Industries Ltd expects sales to rise by up to 15 percent in the 2017/18 crop year as production in Uttar Pradesh could jump to a record high, a top company executive said on Monday.
Farmers in the country's top sugar producing state where the company has its operations, have adopted an early-maturing cane variety that has boosted productivity, Vijay Banka, the chief financial officer of the company, told Reuters.
The state's output could jump 14 percent from a year earlier to a record 10 million tonnes, he said.
"We are expecting 10 to 15 pct increase in crushing and production. Our sales will also rise commensurately," he added.
Dwarikesh Sugar produced 330,000 tonnes of the sweetener in the 2016/17 crop year that ended on Sept. 30.
Higher cane supply will help the company to operate factories at 18,500 to 19,000 tonnes per day (tpd) capacity in the new season, compared with 17,500 tpd a year ago, he said.
The company's profit jumped more than 88 percent to 592.7 million rupees in the June quarter, helping it to reduce its debt.
Dwarikesh Sugar's debt has come down to 760 million rupees from 3 billion rupees at the end of March 2016, he said, adding that the company would be debt-free very soon.
Uttar Pradesh fixes the floor price for cane that is mandatory for mills to pay farmers.
"If cane prices rise marginally and sugar prices sustain, then EBIDTA margin should remain healthy, but it could fall if Uttar Pradesh raises state-advised prices sharply," he said.