"In recent years, the demand for ethanol has continuously increased. Ethanol is
playing a crucial role in helping India achieve its goal of carbon neutrality. As a clean
fuel, it offers a viable alternative to traditional fossil fuels like crude oil.
Dear shareholders,
At Renuka Sugar, we are determined to drive a responsible business. Our continuous
emphasis on embracing sustainable practices have enabled us to resiliently overcome
challenges and pave the path for relentless value creation. It has successfully
rejuvenated our growth trajectory, enabling us to report the highest-ever turnover and
EBITDA.
In FY2022-23, our EBITDA (excluding forex gain/loss) increased by 51% and our total
income rose by 40%, driven by robust demand for sugar as well as ethanol. We also recorded
tremendous performances in terms of total sugar volumes, refinery exports and ethanol
sales. However, weakening of the Indian rupee due to stress on US and European banks has
had an adverse effect on domestic interest rates. The higher interest burden impacted our
profit margins to a certain extent.
In recent years, the demand for ethanol has continuously increased. Ethanol is playing
a crucial role in helping India achieve its goal of carbon neutrality. As a clean fuel, it
offers a viable alternative to traditional fossil fuels like crude oil. By promoting the
use of ethanol, India can reduce its reliance on fossil fuel, lower greenhouse gas (GHG)
emissions and mitigate the impact of climate change. Compared to crude oil, ethanol is a
more economical and sustainable energy source, making it a preferred choice for consumers
and businesses alike.
Moreover, the government's focus on ethanol is also expected to have a positive impact
on the country's sugar industry. Ethanol is produced by fermenting sugarcane juice and
molasses, a byproduct of sugar production. Therefore, ethanol production will not only
reduce India's dependence on crude oil import, but also provide an additional source of
revenue for the sugar industry.
"The government's focus on ethanol is also expected to have a positive impact on
the country's sugar industry.
In line with the growth of ethanol demand in the country, our production during the
fiscal year increased by 19% in comparison to the previous year. It has not only
positively impacted our revenue but, has also allowed us to improve cash flow. During the
fiscal year, we have expanded ethanol capacity from 720 KLPD to 1250 KLPD. Going forward,
we seek to explore other opportunities to further enhance our ethanol portfolio.
We also undertook efforts to increase the market share of ‘Madhur' sugar, which is
consistently growing as a frontrunner in the branded sugar segment. Besides, we are eyeing
prospects for exporting our products and improving our footprint in Indian as well as
international markets.
At Renuka Sugars, we operate with a strong commitment to sustainability. We recognise
the importance of adopting sustainable practices and minimising our environmental impact.
Given the energy and water extensive nature of the sugar industry, we have implemented
measures to reduce specific water consumption from natural sources. We are also
continually working on improving our water management practices. Besides, all our
facilities are equipped with zero liquid discharge facilities to strengthen our
sustainability initiatives. Additionally, we use a large proportion of energy generated by
our cogeneration units for captive consumption. Around 81% of the energy from our
cogeneration process constitutes renewable energy, resulting in a significant reduction in
GHG emissions.
We have also collaborated with an international NGO to engage in sustainable sugarcane
production in Belagavi and Kalaburgi districts in Karnataka. Its primary objective is to
enhance sugarcane yield through an emphasis on training and capacity building. The project
aims to achieve this through judicious use of agricultural resources and improved
irrigation facilities. Importantly, the initiative is also helping to increase
occupational health and safety awareness, primarily among women farmers.
Leveraging the strength of our integrated business model, a dedicated workforce and
strategic investments to improve our core capacities, we aim to capitalise on emerging
opportunities. Along the way, we also aspire to continuously enhance shareholder value. We
remain grateful to all our stakeholders for their continued support for Renuka Sugars. It
keeps us well on track to write a new chapter in our journey of growth with
responsibility.
Regards,
Atul Chaturvedi
Executive Chairman