Dalmia Bharat Sugar & Industries Ltd. Financial Results (Q2 FY26)

Executive Summary: Q2 FY26 (Quarter Ended September 30, 2025) Dalmia Bharat Sugar and Industries Ltd. reported mixed results for the second quarter. While the company achieved 7.4% year-over-year (YoY) revenue growth, this was offset by significant margin compression, leading to a 56.3% decline in net profit. Operational headwinds, including higher sugar production costs, impacted profitability despite stable volumes and improved price realization in the sugar segment. Key Financial Highlights (Q2 FY26 vs. Q2 FY25) Revenue from Operations: Increased 7.4% YoY to ₹988.7 crore from ₹920.3 crore. Net Profit: Declined 56.3% YoY to ₹23.32 crore from ₹53.37 crore. EBITDA: Fell 16.8% YoY to ₹56 crore from ₹67.3 crore. EBITDA Margin: Contracted to 5.6% from 7.3%, reflecting significant cost pressures. Operational Performance (Q2 FY26 vs. Q2 FY25) Sugar Segment: Sales Volume: 1.8 LMT (up 2% YoY). Net Selling Rate (NSR): ₹39.91 per kg (up 4% YoY). Distillery Segment: Sales Volume: 4.02 crore litres (up 3% YoY). Half-Year (H1 FY26) Performance Summary Total Revenue: ₹1,930 crore (up 3% YoY). Net Result: The company reported a net loss of ₹63 crore for the six-month period. H1 Sugar Sales: 3.2 LMT (down 6% YoY), with NSR up 4% to ₹39.86/kg. H1 Distillery Volumes: Showed strong growth, rising 12% YoY to 9.17 crore litres. Key Drivers & Management Context The company’s H1 performance was impacted by several factors: Headwinds: Profitability was constrained by a higher cost of sugar production (attributable to the FRP hike in Maharashtra), lower sugar recovery rates, and reduced operations in cane-based distilleries. Mitigating Factors: These pressures were partially offset by higher sugar price realization (NSR), increased volumes from grain-based distilleries, and a favorable power tariff revision by UPERC effective April 1, 2024.