Conference Call of BCML – Q2 & H1 FY 09
Balrampur Chini Mills Limited
Analysts / Investors Conference Call
April 29, 2009
Anoop Poojari: Good afternoon everyone and thank you for joining us on Balrampur
Chini Mills Q2 and H1 FY2009 results conference call. We have with us Mr. Vivek
Saraogi, Managing Director of Balrampur Chini Mills and Mr. Kishor Shah, Director cum
Chief Financial Officer of the Company. We would like to commence the call with brief
opening remarks from the management, following which we will have the forum open for
discussion. I would now like to invite Mr. Saraogi to make his opening remarks.
Vivek Saraogi: Good afternoon and thank you for joining us to discuss Balrampur
Chini’s operational and financial performance for the second quarter and half year ended
31st March 09. To begin with, I would like to share my perspectives on the sector and
discuss the operational performance with you, following which Kishor will take you
through the financial highlights of the Company during the quarter.
The Country has seen a drastic fall in production this year, which fell from 26.3 million
tonnes last year to around 14.5 million tonnes this year. Sugar-producing states saw a
40% to 45% dip in sugar production. The key reasons toward this fall are diversion of
cane into other remunerative crops, adverse climatic condition, yield of sugarcane from
land, as well as lower recovery. Also, another reason is in the past, there has been
uncertainty on the cane pricing and mill’s inability to pay prices promptly. We expect next
year’s crop to improve; personally I would feel to a level of about 18 million tonnes.
However, it will be still lower than India’s consumption. We estimate consumption to be
around 22.5 to 23 million with a 2% to 3% growth annually. As a result, sugar prices
have moved up and I expect it to remain firm.
The Government has allowed duty-free import of raw sugar without re-export obligation
till 31st of July. We don’t expect sugar manufacturers