Vishwaraj Sugar Industries Ltd (VSIL) will invest Rs 250 crore to set up a new ethanol plant in Belagavi, Karnataka.
At present, VSIL has a sugarcane crushing capacity of 11,000 tonnes per day, distillery capacity of 1 lakh litres per day, co-generation capacity of 36.4 MW, and vinegar manufacturing capacity of 70,000 litres per day.
In a statement, VSIL announced plans to set up a greenfield ethanol production facility, having a capacity of 2.5 lakh litres per day, within 80 km from the existing factory in the Belagavi district.
The company said it has already acquired 110 acres land for this plant. “The estimated project investment is Rs 250 crore and the first full year of operation of this facility shall be FY2024,” the statement said.
Moreover, the company plans to set up a brownfield ethanol production, with a capacity of 1.5 lakh litres per day.
This expansion, scheduled to be completed by November 2023, is driven by technological up-gradation. It is filing a patent to that effect. This will increase the overall ethanol production capacity to 2.5 lakh litres per day.
With both greenfield and brownfield expansion, the total ethanol capacity will reach at 5 lakh litre per day.
“We plan to move up the value chain…Razor-sharp focus on high-value high- margin products, such as pharma grade sugar and ethanol, is expected to increase the revenue per tonne of sugarcane crushed over the next five years,” said Mukesh Kumar, Executive Director, VSIL.
“Also, we plan to ramp up the capacity for ethanol, taking total capacity to 500,000 litres per day,” he added. In the normal course, price realisation per litre of ethanol stands at Rs 62.7 for the ethanol produced from sugarcane syrup, and Rs 57 for the ethanol produced from molasses.
But, in the case of pharma-grade ethanol, the price realisation goes up to Rs 67 per litre, it explained.
VSIL said the company has entered into contracts with oil marketing companies for supplying 25 million litres of ethanol commencing from December 2021, as against the supply of 22.5 million litres of ethanol during the 12-month period ended in November 2021.
VSIL has already commenced a supply of ethanol for the current period.
Recently, the company reported a net profit of Rs 20.67 crore for the nine months period ended December 2021, as compared to Rs 4.17 crore in the corresponding period of the previous year.
Total revenue grew to Rs 337.86 crore from Rs 264.73 crore. In the third quarter ended December 2021, Vishwaraj Sugar posted a 61 per cent rise in total revenue at Rs 133.28 crore compared to Rs 82.75 crore in the year-ago period.
The net profit dipped marginally to Rs 29.44 crore from Rs 30.46 crore on higher tax outgo in December quarter, the statement said. PTI MJH MR MR