ICICI Direct has given Buy recommendation for Dhampur Sugar with a target price of Rs. 210 in its research report issued on Feb 06, 2021

ICICI Direct’s research report on Dhampur Sugar

Dhampur Sugar posted a strong set of results with 36% revenue growth & 22.2% growth in operating profit. The healthy growth was led by higher sugar & distillery volumes. Further, distillery realisation also improved significantly on account of higher proportion of B-Heavy ethanol. Sugar volumes were up 33.9% to 2.45 lakh tonnes (lt) aided by higher domestic sales quota whereas distillery volume were up 70.4% to 3.2 crore litre on the back of high availability of molasses due to extended 2019-20 crushing season. The company is holding 1.87 lt of sugar valued at Rs 30.5/kg as on December 31, 2020. The government announced export subsidy of Rs 6/kg for 6 million tonnes (MT) of sugar. The company has been allotted 1.56 lt of export quota, which has been already contracted at the average price of ~Rs 25.1/kg (excluding export subsidy). The higher proportion of B-heavy volumes aided profitability. Interest cost dipped 37.1% with significant reduction in debt. However, PAT grew at a slower pace due to increased income tax provisioning during the quarter.


We maintain our BUY rating on the stock with a revised target price of Rs 210/share (earlier Rs 175).

For all recommendations report, click here