# 1. Financial Performance ## A. Key Figures * Revenue: ₹254.7 Cr Q3 (+2%) · ₹727.6 Cr 9M (+1%) * Consolidated Revenue: ₹301.5 Cr Q3 (+10%) · ₹855.6 Cr 9M (+8%) * EBITDA: ₹36.3 Cr Q3 (-4%) · ₹125.7 Cr 9M (+9%) * PBT (Pre-Exceptional): ₹4.5 Cr Q3 (+73%) · ₹24 Cr 9M (+471%) * Consolidated PBT (Pre-Exceptional): -₹18.6 Cr Q3 (improved loss) · ₹154.9 Cr 9M (vs. ₹53.2 Cr) * **Gross External Debt:** ₹1,848 Cr (ex-WC) (-15 Cr QoQ) ## B. Revenue Growth * **Modest Stand-Alone Growth:** Top-line expansion remains limited, with low single-digit growth in Q3 and 9M, indicating stable but subdued core demand. * **Strong Consolidated Momentum:** Revenue surged on a consolidated basis, reflecting significant contributions from subsidiaries and improved group-wide performance. ## C. EBITDA & Profit * **Profitability Rebound:** Despite a sharp decline in Q3 EBITDA, nine-month PBT grew over 10x due to **reduction in finance costs by ₹8 crores** and operational stabilization. * **Loss Narrowing in Consolidated Segment:** Consolidated PBT loss improved meaningfully, signaling progress in turnaround efforts despite ongoing near-term challenges. ## D. Debt & Leverage * **Deleveraging in Motion:** Gross external debt reduced by ₹15 crores QoQ, with management expecting accelerated debt reduction in FY27 driven by **inflows from Dubai project and associate company**. --- # 2. Crushing & Production ## A. Key Figures * Crush Volume: **1.1 lakh quintal/day** record · **67.28 lakh quintal** Q3 FY26 (+vs. 60.79 lakh quintal Q3 FY25) * **Capacity Utilization:** **>100%** in Q3 FY26 * Power Production: **+6.7% YoY** in Q3 · **–11.5% YoY** in 9M ## B. Crush Volume * **Record Operational Start:** Earliest-ever crushing commencement on October 26, enabling extended run time and record quarterly throughput. * **Strong Run-Rate Momentum:** Mill on track to deliver **90 lakh quintals** of additional crush post-Q3, supported by 100% capacity utilization over 91 days. * **Supply Chain Resilience:** Strategic location and improved cane payment cycles ensure reliable raw material access, reducing supply risk. * **Market Balance:** India’s sugar market remains balanced with **no material surplus**, supported by ethanol diversion and stable closing stocks outlook. ## C. Capacity Utilization * **Industry-Leading Efficiency:** Sustained >100% capacity utilization driven by operational improvements, breaking historical norms of 90–95%. * **Margin Support:** Firming sugar realizations expected to offset higher cane costs, preserving **8–10% EBITDA margins** in SPE business. ## D. Power Generation * **Q3 Recovery:** Power generation rebounded strongly in Q3 despite lower 9M output, reflecting catch-up from fewer crushing days year-to-date. * **Positive Q4 Outlook:** Sequential improvements in crushing and power point to continued operational strength into final quarter. --- # 3. Ethanol & Byproducts ## A. Key Figures * Ethanol Sales: 17.7% YoY growth (Q3) * Ethanol Production: 4.8% YoY increase (Q3) ## B. Distillery Operations * **Blending Program Success:** Ethanol blending at 20% target deemed successful, significantly curbing forex outflows with adequate existing capacity to meet demand. ## C. Molasses Supply * **Feedstock Constraint:** Despite operational capacity, molasses supply from sugar crushing remains insufficient for year-round distillery utilization. --- # 4. Segment & Subsidiary Performance ## A. Key Figures * Simon India Q3 Income: ₹24.3 Cr (+290% YoY from ₹6.2 Cr) * Zuari Infraworld Q3 Income: **₹36.4 Cr** (up from ₹34.9 Cr) * Oil Tanking JV Q3 Income: **₹7.4 Cr** (up from ₹5.5 Cr) ## B. Simon India EPC * **Project Momentum:** Commissioned fifth evaporator for PPL and executing diverse EPC orders, signaling reactivation of construction business in fertilizers and industrial sectors. * **Order Book Strength:** Maintains a robust pipeline with **outstanding orders worth INR100 crores**, supporting near-term revenue visibility. * **Profitability Timing:** Despite operational profitability across most small subsidiaries, Simon India may report a **small loss** due to EPC revenue recognition delays. ## C. Zuari Infraworld * **Strategic Partnerships Over IPO:** Actively pursuing collaborations—secured mandates in Hyderabad, Kolkata, and Bangalore—while ruling out any IPO plans, focusing instead on Dubai project fund repatriation. * **Revenue Decline Context:** Sharp YoY drop in Q3 income reflects project cycle timing, not strategic setback, as development pipeline progresses. ## D. Joint Venture Income * **ZEBPL Ramping Up:** Ethanol JV with Envien commenced commercial operations on 1 Jan 2026, with **20,000 kilo liters contracted**, ensuring revenue visibility through October 2026. * **JV Tolling Gains:** Oil Tanking JV achieved higher income despite lower volume, driven by **renegotiated tolling rates with OMCs**, indicating pricing power and margin enhancement. --- # 5. Strategic Projects & Investments ## A. Key Figures * **DM Project Target:** **₹10,000 Cr** gross development value (GDV) targeted this FY * **Strategic Investment Value:** **₹4,600 Cr** total listed holdings as of 31 Dec 2025 * **DM Fee Range:** **6–7%** expected on individual projects (₹750–2,000 Cr size) ## B. DM Project Pipeline * **Strategic Growth Focus:** Active pursuit of **INR10,000 crore DM mandates** to drive revenue and support capital recycling, particularly to recoup Dubai project investments. * **Pipeline Momentum:** Business development advancing with term sheet signed in **Bangalore**, and multiple mid-sized DM projects in pipeline across key metros. * **Model Rationale:** Prioritizing DM mandates over land/JDAs enables footprint expansion while focusing on **repatriating funds** from completed overseas assets. * **New Revenue Stream:** **ZEBPL plant commissioned in Jan 2026**, with commercial operations and revenue generation expected from current quarter. ## C. Dubai Inflows * **Near-Term Cash Infusion:** Dubai project completion expected by **31 March**, with buyer handovers and fund inflows commencing in **April**, marking a key liquidity milestone. ## D. Land & Real Estate * **Land Bank Visibility:** Combined **~520 acres** held across Zuari entities (Industries and Agro), providing long-term strategic optionality. * **Upcoming Launch:** Texmaco Infra plans major real estate project launch in **Q1 next fiscal**, signaling continued execution in domestic markets. --- # 6. Risks & Regulatory Issues ## A. Key Figures * **Exceptional Item (Q3):** **INR2.81 Cr** negative impact from new labor codes ## B. Ethanol Pricing * **Pricing Divergence:** Ethanol profitability under pressure due to stagnant government procurement prices despite **higher sugarcane costs** and stable sugar prices, breaking historical linkage. * **Industry Advocacy:** Management reiterates call for remunerative ethanol pricing to ensure long-term program viability amid rising input costs. * **Operational Resilience:** Strong Q3 performance achieved despite UP sugarcane shortages, with expectations of further improvement. ## C. Land Monetization * **Goa Land Constraints:** Monetization of Goa landholdings excluded from current deleveraging plans due to **new regulatory restrictions** on land use changes; legal and strategic options under review. * **Real Estate Strategy:** Company expanding development management mandate footprint into Southern states and Kolkata amid ethanol sector overcapacity. ## D. Labor Regulations * **One-time Cost Impact:** Q3 hit by **₹81 Cr** non-recurring charge from implementation of new labor codes, affecting consolidated results. * **Subsidiary Losses Explained:** Consolidated losses in subsidiaries attributed to **group-level debt and interest burden**, not underlying operations. --- # 7. Guidance & Outlook ## A. Key Figures * **Crushing Days:** **300+ days** achieved last sugar season · targeting **300+ days** in sugar season '25-'26 or FY27 * **Distillery Operations:** Targeting **330 days/year**, with **30 days maintenance** * **Fund Inflows:** **₹800–900 Cr** from Dubai project · **₹273 Cr** from Zuari Agro Chemicals ## B. Crushing Days * **Record Operational Run Rate:** Achieved record crushing season with over 300 days, underpinned by **sufficient captive molasses availability** enabling sustained ethanol production. * **Sustained Utilization Target:** Management aims to maintain **300+ operational days annually**, with a structural shift toward longer distillery runs despite planned maintenance cycles. ## C. Fund Inflow Timing * **Near-Term Cash Flow Delay:** No inflows expected from Dubai project in Q4; realization to commence only in **Q1 of next fiscal**. * **Debt Reduction Catalyst:** Combined inflows of **₹1,073–1,173 Cr** set to significantly reduce leverage, with management prioritizing early receipt within next fiscal. ## D. Growth Drivers * **Emerging Real Estate Contribution:** DM project poised to become a **major growth driver**, with meaningful revenue and profit contribution expected in coming quarters. * **Cautious Forward Visibility:** Pipeline outlook for FY '27 remains conservative as focus stays on execution of current projects and measured expansion. * **No Forward-Looking Guidance:** Management declined to confirm potential **20% sugar business growth** or provide any formal top-line/bottom-line projections.