### **Overview** Dhampur Bio Organics Limited (DBO) is a leading integrated sugarcane processing company in India with over 90 years of industry experience. Headquartered in Uttar Pradesh, DBO operates three fully integrated sugar and bio-energy units at **Asmoli**, **Mansurpur**, and **Meerganj**, strategically located in cane-rich regions to maximize logistical efficiency and raw material access. The company was demerged from its parent organization in 2022, enabling it to pursue a focused, independent growth strategy. DBO's business is built on three core verticals: 1. **Sugar** – including raw, refined, branded, and pharma-grade sugar 2. **Biofuels & Spirits** – ethanol (from molasses and grain), Extra Neutral Alcohol (ENA) 3. **Country Liquor** – potable spirits for the domestic market The company is repositioning itself as a **comprehensive sugar solutions provider and bio-energy leader**, leveraging innovation, vertical integration, and sustainability to drive margin resilience and long-term growth. --- ### **Operational Highlights (as of Jun–Nov 2025)** #### **Production Capacity** - **Total Sugarcane Crushing Capacity:** 29,500 TCD - Asmoli: 12,500 TCD - Mansurpur: 8,000 TCD - Meerganj: 9,000 TCD - **Sugar Refinery Capacity:** 2,000 TPD (Asmoli: 1,100 TPD; Mansurpur: 900 TPD) - **Pharma-Grade Sugar:** 700 TPD (exclusive to Asmoli plant, FSSAI-approved) - **LQW Sugar:** 800 TPD at Meerganj - **Biofuel (Ethanol) Production Capacity:** 312.5 KLPD (312,500 LPD) from B-heavy molasses at Asmoli - **Renewable Energy Generation:** 95.5 MW (Asmoli: 43.5 MW, Mansurpur: 33 MW, Meerganj: 19 MW) - **Country Liquor Capacity:** 8 million cases/year (Asmoli) - **CO₂ Production:** 80 TPD (Asmoli only) --- ### **Strategic Direction & Business Transformation** #### **1. Shift from Commodity to Value-Added Sugar** - DBO is actively **decommoditizing its sugar business** by shifting focus from bulk sugar to **value-added, packaged, and specialty sugars** (e.g., pharma-grade, fine-grain, niche retail, and sachet packaging). - Packaged sugar currently accounts for **<2% of India’s sugar consumption**, but is projected to grow at **>12% CAGR**, presenting a major growth avenue. - The company has entered the **branded sugar sachet market** and offers **private-label packaging**, targeting modern trade and FMCG channels. - Dhampure, DBO’s branded sulphur-free sugar, is recognized as a **prestigious FMCG brand**, available on e-commerce platforms. #### **2. Expansion of Packaged & Specialized Sugar** - **Asmoli facility expansion** underway to increase packaged sugar capacity. - Services such as **inventory management and dispatch** are now being offered to institutional clients, enhancing customer integration. - **Pharma-grade sugar** is supplied to leading formulation brands, with high repeat order rates due to consistent quality. - The strategic goal is to become a **one-stop sugar solutions provider**, offering differentiated products across grain size, packaging, application, and logistics. --- ### **Biofuels & Spirits – Growth Engine** #### **Dual-Feed Distillery Transformation** - DBO has **converted its Asmoli distillery (100 KLPD)** into a **dual-feed facility** (molasses + grain), completed in **June 2025**. - This enables flexible switching between feedstocks based on availability and pricing, optimizing ethanol output and reducing idle time. - In **Q1 FY26**, grain-based ethanol production contributed **1 million bulk liters** (out of 19.33 million total), an **89% YoY increase**. - Alternative feedstocks include **maize and broken rice**, with access to UP’s maize belt enhancing sourcing advantages. #### **Ethanol & Country Liquor Performance** - **Ethanol revenue surged 84% YoY in Q1 FY26**, contributing significantly to a **28.75% overall revenue growth**. - DBO is a **longtime participant** in India’s ethanol blending program (since 2001) and supplies both public and private oil marketing companies. - The country liquor business has grown strategically, with **double the production capacity (8 million cases)** and plans to maintain growth via volume expansion despite fixed MRP pricing. #### **Capex & Government Support** - FY25 capex guidance: **INR 95 crores** - **INR 60 crores** allocated to grain-fed distillery conversion under **government interest subvention scheme** - Sugar segment capex focused on **maintenance and efficiency improvements** --- ### **Cane & Supply Chain Resilience** - **Cane Development Focus:** Ongoing efforts to improve yield and recovery via **high-recovery, disease-resistant varieties** and farmer engagement programs (e.g., tissue culture labs, micro-nutrient trials). - **Red Rot Challenge:** Cane acreage declined **4–5% at Asmoli and Meerganj** due to red rot disease affecting Co 238 variety. However, **plant cane now features 45–50% non-Co 238 varieties**, signaling a shift toward long-term recovery. - **UP-Wide Trend:** 5–7% decline in sugarcane acreage across Central and Eastern UP, but management expects a **rebound from 2025–26 season** with new varieties. - **Competitive Landscape:** New mill by Bindal Group has had **minimal impact**, affecting only 2–3 collection centers near Asmoli. --- ### **Integration & Diversification Strategy** - **Vertical Integration:** Fully forward-integrated into **co-generation, ethanol, and country liquor**, reducing exposure to sugar price volatility. - The **sugar, biofuels, and country liquor segments** are synergistically linked, enabling efficient use of by-products (e.g., bagasse for power, CO₂ for industrial use). - Revenue mix is shifting favorably: - Sugar: ~58% of FY25 revenue (down from 59% in FY24) - Biofuels & Spirits: ~11–19% (increasing due to ethanol growth) - Higher-margin non-sugar segments show **more stable profitability**, buffering cyclical sugar market risks. --- ### **Sustainability & Innovation** - A pioneer in **renewable energy** from bagasse; **95.5 MW** of biomass power generated annually. - **Carbon capture:** Produces **80 TPD of CO₂** as a by-product, contributing to circular economy. - **Sulphur-free sugar** (Dhampure brand) launched over two decades ago; continues to command premium positioning. - R&D focus on **new cane varieties with higher biofuel yield** and optimized input use. --- ### **Market & Policy Environment** - **Government Policy Impact:** - Beneficial: **1 million MT sugar export quota** boosted realization and cash flow. - Constraining: No revision in **sugar/ethanol MSP**, affecting industry margins. - DBO actively engages with policymakers to advocate for **long-term, stable ethanol and sugar policies**. - **Ethanol Blending Target (30% by 2030)** supports long-term demand, with DBO well-positioned to expand capacity. --- ### **Recent Developments (Aug–Nov 2025)** - **Asmoli plant** entering crushing season post-Diwali with **anticipated yield improvements**. - **Country liquor focus reinforced** – company will **not enter IMFL space** due to lack of strategic fit, focusing instead on leveraging existing capacity and margins in country liquor. - **Grain-based ethanol operations** now **fully operational from mid-November 2025**, allowing year-round production and better asset utilization. - **Discussions underway** with international partners (e.g., Japanese government) on **use of ethanol in diesel and aviation turbine fuel (ATF)**, though no concrete projects yet.