Mumbai: Shree Renuka Sugars, India’s top refiner, posted a 15% rise in consolidated net profit in the June quarter boosted by its recently-acquired Brazilian units, a top official said on Thursday.
The firm posted a net profit of Rs90.20 crore in April-June compared with Rs78.10 crore a year ago. Net sales more than doubled to about Rs200 crore in the period.
Shree Renuka acquired sugar and ethanol producer Vale Do Ivai S.A. Acucar E Alcool for $82 million in November 2009 and also bought a majority stake in Equipav SA Acucar e Alcool in June 2010, helping it secure key raw material cheaply and giving it access to the world’s largest sugar producer.
It expects these acquisitions to help it in coming quarters, boosting margins, managing director Narendra Murkumbi told television channel CNBC-TV18.
“All our fresh raw sugar imports are refined and re-exported on a going basis, which is the original model on which we had built the refineries earlier. And we expect good margins there,” Murkumbi said.
“Our refineries are now producing sugar for exports rather than for domestic sales. Refining margins are much better there and we should start seeing that in the next two quarters,” he added.
Premium on white sugar is higher than the normal premium over raws due to a squeeze in the global market.
On standalone basis, the company’s sales jumped 70% on year, but net profit plunged 85% to Rs8.9 crore due to weak domestic prices, which have fallen by nearly a third in 2010.
Shares in the firm ended 0.3% higher at Rs66.95 in a flat Mumbai market.