Sales rise 25.80% to Rs 33.07 crore, Net Profit Rs 5.66 crore

Mumbai, January 24, 2005:- Dwarikesh Sugar Industries, an integrated sugar manufacturer, has reported a 25.8 per cent growth at Rs 33.07 crores in sales for the quarter ended December 2004. The first quarterly results after the initial public offering were approved by the board today. Sugar contributed Rs 31.7crore of the revenue and balance Rs. 5.48 crore came from the co-generation power plant. The company posted a Net profit for the quarter at Rs 5.66 crore.

The operating margins have jumped to 29.83 % from 6.31 % during the first quarter aided by higher realisation in sugar prices and better inventory management besides cost control measures. Our recovery is one of the highest in U.P. at 10.50% due to efficient cane procurement programme reducing time between reaping and crushing. The management expects the price of sugar, bagasse and molasses to remain at higher levels due to persisting cane shortage. The company has also been successful in reducing the interest cost on its loans through repayment and structuring of high cost loans.

The company's distillery unit with a capacity of 30 (KLPD) will begin trial production by February, 2005 and commercial production by mid-February. The distillery unit for manufacture of Ethanol will use molasses as a raw material available from the sugar plant. Ethanol is mixed with petrol as a pollution control measure.The Board of Directors , has also authorised its Chairman & Managing Director , Mr. G R Morarka to explore the possibilities of two new green field projects of 7000 TCD plants besides ongoing expansion of the existing plant.

Mr G R Morarka, Chairman and Managing Director, Dwarikesh Sugar Industries said, "Our revenues have grown at 25.8% while cost controls have ensured higher profitability. Our present growth plans to become a large sugar conglomerate with interests in synergistic businesses are on course. Commencement of distillery unit as a forward integration will further enhance our product portfolio and lead to margin expansion."

Dwarikesh Sugar Industries made a successful IPO in November 2004 raising Rs 32.50 crore. The company has issued 50 lac shares at a premium of Rs 55 per share (face vaue Rs 10) was oversubscribed 23 times. The company currently has a sugar crushing capacity of 6500 TCD and 17 MW Co-generation power unit. The company supplies around 8MW to UP power corporation Ltd.