India's Dalmia Bharat Sugar Q1 profit falls on higher inventory, finance costs

E I D-Parry (India)

02/08/2024 15:21

BENGALURU, Aug 2 (Reuters) - India's Dalmia Bharat Sugar and Industries  DLMI.NS  reported
a 10.8% fall in first-quarter profit on Friday, hurt by higher inventory and expenses.
    The company, which supplies sugar to companies like Coca-Cola  KO.N , Britannia  BRIT.NS ,
Dabur  DABU.NS , and Carlsberg  CARLb.CO , reported consolidated net profit of 547.3 million
rupees ($6.5 million), compared to 613.4 million rupees year ago.
    Revenue from operations rose 15.2% to 9.6 billion rupees. However, total expenses rose 19.2%
to 9.01 billion rupees.
    For further results highlights, click  urn:newsml:reuters.com:*:nFWN3JP2T9
    
    KEY CONTEXT    
    Indian sugar companies have been battling increased inventory costs. While Dalmia Bharat's
inventory cost rose more than two-fold in the first quarter, rival Dwarikesh Sugar Industries
 DWAR.NS  and Dhampur Sugar Mills  DAMS.NS  saw those expenses grow more than five-fold and nearly
10% respectively.
    India, the world's largest sugar consumer and second-biggest producer, restricted the use of
sugar in ethanol production during the 2023/24 marketing year that ends on Sept. 30 and also
prohibited exports to keep a lid on domestic prices, leading to a larger inventory for the
companies. 
    
    PEER COMPARISON    

                             Valuation (next  Estimates (next      Analysts' sentiment       
                               12 months)       12 months)                                   
                  RIC        PE      EV/EBIT  Revenue  Profit  Mean     No of     Stock to   Div
                                     DA       growth   growth  rating*  analysts  price      yield
                                              (%)      (%)                        target**   (%)
 Dalmia Bharat     DLMI.NS    10.42     7.79   17.19   10.79   Hold            1    0.82      1.25
 Sugar and                                                                                   
 Industries Ltd                                                                              
 E I D-Parry       EIDP.NS    38.04    45.55     -       -     Strong          1    0.89      1.00
 (India) Ltd                                                   Buy                           
 Dwarikesh Sugar   DWAR.NS    11.79     8.39   2.36    18.51   Buy             2    0.97        -
 Industries Ltd                                                                              
 Balrampur Chini   BACH.NS    16.96    12.94   9.35     8.66   Strong          4    0.98      0.62
 Mills Ltd                                                     Buy                           
    
    
* Mean of analysts' ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong
Sell
** Ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock
is trading above the PT


APRIL-JUNE STOCK PERFORMANCE   
    
    
-- All data from LSEG
-- $1 = 83.7250 Indian rupees                  


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UPL June Qtr 2024 vs Peers    https://tmsnrt.rs/4dppujs
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 (Reporting by Ashish Chandra in Bengaluru)
 ((ashish.chandra@thomsonreuters.com; +91 7982114624;))