EID Parry India Limited (EIDPARRY) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to AID Perry India Q4 FI 26 earnings conference call hosted by Dan Capital Advisors Limited. As a reminder, all participant lines will be in the lesson only more and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, leave signal in operator by pressing star, then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Abhishek Mehra. From Damn Capital, thank you and over to you, sir.

Hello, everyone, and a warm welcome on behalf of Dan Capital Advisors to the Q4 and F526 earnings call of EID Perry. We thank EID Perry's management for giving us the opportunity to hold this call. On the call today, we have Mr. Mutayya Murugappan, whole-time director and CEO, along with the senior management team of EID Perry. I hand over the call to the management for opening remarks, followed by a Q&A session. Thank you, and over to you, sir.

Thanks, Avisek, and good morning to everyone. It gives me a great pleasure to be a part of the analyst's call to share an update on the global as well as the Indian scenario and explain further on Q4 performance and FY26 performance of our company. I'll start with the global scenario. Global sugar markets are softening with a clear downward price trajectory and a shift back to surplus conditions. White sugar prices have corrected from USD $500 per ton levels in 2025 to about USD $420 per ton levels by early 2026, while raw sugar has declined from about $0.80 per pound to about $0.14 per pound in the same period. This reflects improving global supply with total production of 196.7 million tons, exceeding demand of 193.8 million tons. In 2025-2026, led by higher output in India and Thailand, partially offsetting mixed trends in Brazil and the EU. Overall, global balances are moving from deficit to surplus and exerting downward pressure on prices and limiting export attractiveness. On the India front, sugar year 2025-2026 estimates are as follows. Close production 31 million tons. Diversion for ethanol 3 million. 7 million tons. Thank you.

Thank you. the key operating parameters of each of the segments. Sugar operations, the crushing operations in Karnataka and Tamil Nadu, we have completed in Q4. So, on an average, we have run about This is about 77 days, second as the 76 days of the corresponding. As far as the cane crushing is concerned, we crushed about 17.75 lakhs metric tons, against the 17.62 lakhs metric tons of the corresponding quarter of the previous year. As far as the recovery is concerned, for the current quarter, we are at 11.19, against the 10.89 of the corresponding quarter of the previous year. As far as the sugar production is concerned, in the current quarter, we produce about 1.74 lakh metric tons of sugar, again as the 1.55 lakh metric tons of the corresponding quarter of the previous year. So, cane cost for the current quarter is a 4087 per metric ton. Thank you. We have 73,000 metric tons of the corresponding quarter of the previous year. As far as the sugar realization is concerned, we are, for the current quarter, it is a 39.28 basis. As I mentioned, it is a 39.22 basis of the corresponding quarter of the previous year. So we maintained at the closing stock at 1.92 lakh metric tons. of the corresponding quarter of the previous year. As far as revenue from the sugars is concerned, about 466 crores for the current quarter, as evidenced the 408 crores of the corresponding quarter of the previous year, registering an increase of about 14% on account of the exports. As far as the cogen operations is concerned, we generated about 1,499,000,000 units in the corresponding period of the previous year. As far as the power exports is concerned, we exported about 845,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000. As far as the revenue is concerned, for the current quarter, about 66 crores has acknowledged 58 crores in the corresponding period of the previous year. As far as the delivery operations is concerned, we produced about 452 lakhs liters during the quarter, as evidenced 438 lakhs liters of the corresponding quarter of the previous year. As far as the sales is concerned, 404 lakhs liters. So, the composition of 404,000,000,000,000,000,000,000,000,000,000 As far as the price relation is concerned, the average relation is at 64.25% of the current water. As recognized, the 66.98% per litre as compared to the corresponding period of the previous year. As far as the revenue is concerned, for the current quarter, we have achieved about 275 crores revenue, as evidenced 268 crores during the corresponding period of the previous year. As far as the neutral operations is concerned, we achieved a turnover of about 13 crores in the current quarter, as evidenced 9 crores in the corresponding period of the previous year. The increase is due to the more exports to the U.S. as the U.S. tariff is got settled. At a consolidate level, turnover was about 50 crores. There was another 60 crores in the corresponding So, next is like a consumer product group, CPC division. The consumer product group has achieved a turnover of 115 crores during a Q4, has at least 195 crores of the corresponding period of the previous year, registering a decline of 48%. The decrease in the CPC revenue system from a purposeful... The deliberate shift towards the better channel optimization and an improvement in the margin profile of the business. I'll move on to the refinery operations. The production in the refineries in the current quarter is about 1.6 lakh metric tons. Thank you. in the previous corresponding quarter was about 2.05 lakh. As far as the revenue is concerned with the current quarter about 1,006 crores, 1,006 crores, again as the 1,019 crores in the corresponding previous year quarter. Loss for the current quarter after accounting of the other cost about 2.93 crores, again as the loss of 99 crores in the corresponding previous year quarter. Intercarpet deposits are nil. As far as external borrowings is concerned, 5.93 crores. I also wanted to update the status on the PSRAPL, the closing operations, because we have intimated to the top exchange by the EAD Perry and the Statute Authority as on 31st March about the closure of the operations. So at the same time, we will also operate in front of all the Statute Authorities in the first week of April. The remaining contracts are completed by 15-50. The next activity, what we have taken is the ACZ exit. The unit is located in the ACZ. So we obtained the ACZ exit. Exit formalities. Thank you. Thank you. The further payment to the banks. This indexing is funneled through. Another 1.4 million scheduled for the payment in June 26th. This will be funded through internal receivables from the PSRAPL. So the liquidation with above all the loans obligations of PSRAPL will get completed. Thank you.

Thanks, Venkat. I think we've also uploaded the presentation.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking the question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Gautam from Nalanda Securities. Please go ahead.

Yeah, hi. Thanks for taking my question. So, the first question is on the consumer goods business. So now going ahead, what's the plan over there in terms of, so we have the sweetener division, and now you're focusing on some adjacencies. So what would those products look like? And basically, when you say value added, what should we define the margin profile of those products as opposed to the rise and pulses that we were doing?

So, Gautam, thanks for the question. So, going forward on the CPE side, the strategy is to have a stronger margin profile on the business model. I think, as you indicated, some of the, you know, rice and pulses, et cetera, are pretty low margin products. And we have, you know, defocused to some extent. We're focusing on those products only in sort of few channels. But in terms of the margin-accretive products and value-added products, they will be more on the browns line, which is, you know, jaggery, a couple of variants of brown sugar, premium whites. So this is all in the realm of sweeteners. And newer product launches also in the realm of sweet products, which are being planned for later in the year. A lot of these value-added products move the business into the 30-plus percent gross margin level, and this is really the intent in terms of how we want to move forward.

Okay, and we were looking at some acquisition also, right, you had mentioned in the last call, so has there been any progress made on that, and are we still looking at it, or there's a shift in strategy for that also?

So, Gautam, I think on the last call, we had sort of outlined that we will specify the sort of segments within the food FMCG space, which we're going to be looking at. I think the investor presentation covers that, as we're talking about ethnic snacking and culinary convenience. These are segments which we are looking at further. In terms of how to enter these segments, these are conversations which we are having as well. But these are the segments of focus which we look at beyond the sweet products and sweeteners.

Okay. And secondly, on the Nutra division, so now how should we look at this division? So, there are two, three products that we are focusing on. So, what would be the scale-up strategy over there, and what would be the general margin profile of this business once everything stabilizes?

So, Gautam, on the Nutra piece, Nutra India continues. There are no new product launches planned. We obviously have the algae processing and exports, which we do. That will continue. I think they've had a reasonable performance, and I think we will continue now with some of the tariff issues being settled. We will continue to progress that piece. I think there will be more action on the Valencia front, where we have also communicated two product launches, one on the prostate side as well as one on the Derm Health side. So this scale-up will happen in Valencia going forward. I think what we will see in Valencia is an expansion of top line. As well as from our bottom line performance, as mentioned, we have...

And just one last question. So just like how we've seen the West Asia crisis, post that, have you all seen any change on the ethanol division when you're interacting with some government bodies in terms of either improving the mandate from E20 or in terms of pricing also? Do you see anything positive happening this year?

Good morning, this is Ashik here, I head the Sugar and Biofuel Division. Obviously, most of the news around this is in the public space. The good development has been the government sharing their intent through the BAS spec for E30. We have been telling this for the last four to five quarters, expect positive action from the government. It will become visible during the allocations that will come up in the new ethanol year. We remain firmly positive that the crisis, one silver lining would be the improvement in ethanol blending percentages because it's good for the fuel security of the country.

Are there any talks you had on pricing revisions?

Government would, our last read of the situation was that there may not be too much action on pricing, but there will be an action on increase in blending percentages.

Okay. Thank you so much.

Thank you. Next question is from the line of Russia from RBSA Investments. Please go ahead.

Most restructuring that has happened. I just want to understand for the, say, rupees, every rupees, 100 rupees that, you know, operating cash that is generated, how do we allocating capital now across the existing segments? If you could just share some thoughts and where are you doubling down more? And also, is there any strategy divestments left or are you looking to continue all the existing businesses?

So, Rishabh, thanks for your question. I think now we will post the restructuring at the refinery. I think we will be continuing with the existing sugar and biofuel operation, the CPG, as well as the neutral operations. I think that's the plan. In terms of capital allocation, there will be a focus on the CPG segment. A lot of the investment there really goes into the A&SP program. There's no real capex as such. The only CapEx that we're doing this year is largely the new Jagri facility. That's about a 45-odd growth CapEx, which we're doing. There are no other CapEx plans. I think it is just given the industry situation, given perhaps the more macroeconomic situation, I think we will hunker down and run for cost and efficiency in terms of the core business. And in terms of the CPG business, of course, invest in brand building, expansion of this.

In terms of the consumer product, just a follow-up, I think you have recalibrated a strategy of focusing more on the higher margin segments. So, is it reasonable to assume that I think since we have been in this segment since quite a while now, so at least in the next three to four years, can we assume a significant share of profits or revenue shares is 20-25% coming from this segment? Or how should one look at the segment scaling up now? Or it is too early to say?

So, sir, the intent is to break even within the next six to eight quarters and exit this decade with a good single-digit percentage.

Before we take the next question, a reminder to all the participants, if you wish to ask a question, please press star and 1. We will take our next question from the line of Raja Kumar Vedranathan from RK Invest. Please go ahead.

Yes, good morning. Can you hear me?

Yes, we can.

Yeah, thanks for the opportunity. So, just a couple of questions. So, the first one is, there was a reason after, you know, September 2025 tariff ruling, which many of the terminal sugar companies have taken advantage of. Just wanted to know, is that award not applicable to EID tariff?

Can you repeat the question?

No, no, no. I think some of the others took benefit of it.

Some of the others not applicable to us because largely our power exports are through AEX.

Some of our peers have taken benefit of it. You're right.

Because I saw even EAD was mentioned in the tribunal order as a co-applicant, so that's the reason I'm asking.

Do you want to comment, sir?

Maybe you have done it in the past, like it's not now, maybe, because the order is applicable, I think, way back 2010 something, like 2003.

My colleague is just commenting on that. At present, we are exporting mostly on exchanges, but the tariff are also pre-debt. So we have some units where there are power purchase agreement, we may get little benefit for those periods, but we are needed to assess that those years.

Okay. But any reason you are not taking cognizance of the benefit in this quarter? Because other companies have already accrued that benefit. That's the reason I'm asking you.

We have not taken cognizance of those things.

Okay. But is it a substantial amount?

I don't think it's a substantial amount. Oh, got it.

So the second question is, what is your outlook for the sugar planting in Tamil Nadu sugar mix?

We have planted roughly about, we are looking at about 10 to 15 percent increase in the planting. Okay.

And even the recoveries were better, right, in the current year compared to the previous years?

We had a good upside on recovery. If your question is relevant to Tamil Nadu, we had about a 0.5% improvement in recovery, and that I think is endemic across multiple sugar units in TN because we have had good weather, diurnal weather. Karnataka also had a good upside in recovery. So those two are big positives for us.

And do you expect this momentum to continue the upcoming years? Do you see an increase in planting based on the previously good performance?

Tamil Nadu will be constrained because of attractiveness of the other crops. The government has been focusing on paddy per se, as you are aware. Having said that, we look at a portion of improving from where we are in terms of planting and also expect some upsides on recovery. Okay.

And lastly, any word on this, if the fuel blending, if it goes beyond 20%, so what would be the impact for Sikurva, please, and particularly AD Paris? Will we participate on the upside, and what is your outlook on that?

Any increase in the ethanol blending percentage would benefit the sugar industry, and our base assumption is that government would want to support the sugar industry. We will benefit by higher allocations in Karnataka from the OMCs. What it would translate is probably increased capacity utilization. We, as Muthu pointed out in the earlier thing, we have produced about 16 crore litters. We would probably tend towards 17 crore litters if there is an improvement in ethanol blending percentage.

And lastly, any word on MSP, first of all, when you have heard anything?

Not really. I think given the inflationary pressures, That looks unlikely.

Okay. Thanks so much.

Participants, you may press star and want to ask a question.

The company has a grand vision of diversifying into a food company, but other than sugar, I don't see any growth anywhere, no significant operation either yet. When do you think Parry will turn profitable, actually? Yes, sugar refinery has gone. That is one big stone off the neck. But other divisions are also not showing much improvement.

Yeah, so thank you. Thank you for the question. So maybe let me start with the first point which you made in terms of product line. It's largely sweetener focused. I think that is obviously a core competency, and that's how we've gotten started on the CPG business. So I think we are really doubling down. We are the market leader there. I think it makes sense to strengthen that position. We, as you know, launched into the staples category. We recalibrated the strategy there to focus on certain channels. There's also more products on the sweet products and sweet products. Categories which we're looking at. It certainly is a broader vision, but you're right for now. Thank you. I think you have pointed out. to that as well, where cane has been dwindling. This has been a drag. We are running very tightly on cost and efficiency, so over time, I think we will have to manage this piece better, bring costs down, you know, improve our working capital management to stem the losses which are coming from this segment. I think our Karnataka operations remain a very, very critical area of focus. We've looked at the metrics and we certainly compare to best in class in the industry, and I think we will continue to focus on Karnataka, which will drive the core part of the company.

I have two more questions, significant questions. Number one is, are we looking at acquisitions in the food business or snacking business to grow the product line?

So, as I mentioned, there are two areas of interest for us. One is ethnic snacking and culinary convenience, and we are working out how best to launch into these spaces. But I will reiterate that I think strengthening the current business model is very, very important in order to build a stronger business model and also to attract capital for growth. This is really why we're focused on that.

The biggest concern for the Murugappa group is that Coromandel and EAD Parry both have become vulnerable for takeover. Look at Coromandel's market cap. We hold 56% of it in EAD Parry. Look at our market cap. 41% of the equity in AD query is held with public. Don't you think we are under a takeover attack?

So, no, this is not something which, you know, I would like to comment on here. I think we're here to really discuss the EID study operation.

I'm sorry to interrupt, sir. Your voice is breaking.

Yeah, so, sir, for your question, I think I will refrain from commenting on this, because this is not really in the context of the discussions here today, which is going to focus on the EID Perry operation. Do you want to add anything, sir?

I'm talking of EID Perry survival.

Sir, EID Perry, 40% held by promoters, 60% is public. So, criminal 56% held by EID Perry. How can it be taken over the state? Anyway, this forum is not for discussion on that, so I don't think there is any such takeover threat.

I think, you know, like a strong player acquiring some considerable portion of the public equity can influence some institutional investors to swing also. I'm concerned. I'm talking out of concern. I'm not casting as persons. I'm worried about EID Perry and its existence.

That's a concern for every public limited company, because as per civil regulations, only 25% to be held by the...

If you are satisfied, I have nothing to get worried about. I just need to get a stronger answer.

Sir, we are not concerned. As you know, this promoter group has owned and run these businesses for a very long time. We have seen multiple cycles. We have also seen a very challenging restructuring, which we have just done, of the refinery. So I think, you know, we are very, very long-term players. So we are not seeing a concern. You are free to watch this?

As a shareholder, I am concerned about when we will resume paying the dividends.

I think we're working towards strengthening of the business model.

Next year, possibly.

In our endeavor to strengthen the business operations of the company going forward, I can't really give you any timelines on this.

Okay.

Thank you. A reminder to all the participants, anyone who wishes to ask a question, may press star and 1. Participants, you may press star and want to ask a question. Final reminder to all the participants, if you wish to ask a question, please press star and 1. As there are no further questions from the participants, I now hand the conference back to the management for closing comments.

Thank you all for logging into the Q4 and FY26 conference call. We look forward to connecting again at the end of Q1.

Thank you very much. On behalf of DEM Capital Advisors Limited, that concludes this conference. Thank you all for joining us today, and you may now disconnect your lines.