But two stocks have bucked this trend. Balrampur Chini has delivered a 40% return, and is down just 11% from its recent high. EID Parry is up 45% and is trading near all-time highs.
Why have these two sugar stocks proved resilient while the broader pack struggles? Here’s a closer look.
#1. Balrampur Chini Mills
Balrampur Chini Mills is the second-largest and most integrated sugar producer in India, with a presence in the sugar, ethanol and power sectors. All 10 of its plants are located in Uttar Pradesh, where the company has built deep relationships with farmers.
Beyond the traditional sugar business, Balrampur has also diversified into the distillery business and is now entering bioplastics through a polylactic acid project. This has helped it reduce its dependence on volatile sugar prices and manage working capital cycles better than its competitors.
Top line flat, margins protected
In FY25, Balrampur Chini’s revenue saw a modest decline of 3% year-on-year to ₹5,415 crore. The company now generates 22.8% of its revenue (including inter-segment) from non-sugar segments, up from 16.6% in FY21. This gradual diversification has helped reduce its reliance on the volatile sugar business.
That said, the sugar segment still contributes the bulk of profits, accounting for 71.3% of profit before interest and taxes (PBIT). Net profit declined 20.5% to ₹344 crore, a relatively smaller fall than most peers. For instance, Triveni Engineering’s net profit was down 37%, with margins contracting 380 basis points (bps) to 9.4%.
Balrampur’s margin fell only 110 bps to 13%. This resilience came from a combination of firm sugar prices, improved cane quality, and disciplined segment-level execution. Balrampur’s ability to defend margins is one of the reasons why the stock has continued to outperform.
Sugar remains mainstay, but efficiency is real differentiator
In FY25, the sugar segment delivered steady growth, with revenue rising 4.3% to ₹4,897 crore. The improvement was driven by a firm average realisation of ₹41 per kg, aided by lower national output and a one million tonne government export quota. Segment PBIT rose 10% to ₹468 crore, with margins expanding 60 bps to 9.6%. This was supported by better operational efficiency across the supply chain.
Cane crushing declined only 1.7% during the year and gross recovery dropped just 0.44%, the lowest among mills in eastern UP. A significant portion of this came from reducing dependence on the red rot-prone 0238 variety, which now accounts for only 6% of its cane mix.
Balrampur’s recovery was also 0.7% higher than the UP state average, directly lifting sugar output and margins. This execution has played a role in maintaining relatively stable earnings.
The company currently holds around 750,000 tonnes of sugar inventory, which it expects to liquidate before November. This should support volume visibility and cash flows in the first half of FY26.
Distillery: A tough year, but flexibility softened the blow
In FY25, Balrampur’s distillery revenue fell 15% to ₹1,430 crore, while PBIT dropped 41% to ₹192 crore. Segment margins declined 600 bps to 13.4%. This was due to the government’s decision to keep ethanol prices flat despite a hike in the fair and remunerative price (FRP) of sugarcane.
Also, restrictions on ethanol diversion in H2FY25 caused underutilisation of distillery capacity, leading to operating deleverage. However, feedstock and capacity flexibility helped limit the damage compared to peers.
Its Maizapur unit can switch between juice, B-heavy, C-heavy molasses and even maize, allowing the company to adapt production in response to policy shifts. In the off-season, Balrampur shifts to maize ethanol to cushion the blow.
For comparison, Triveni’s distillery margin fell over 1,100 basis points to just 3%, highlighting how fixed-capacity setups struggled far more. This structural difference has helped Balrampur protect profitability. The company expects distillery performance to recover in FY26, provided the government reverts to FRP-linked ethanol pricing—a move management believes is likely.
De-risking the future: The PLA opportunity
One of the clearest reasons Balrampur’s stock continues to outperform the sugar pack is its diversification in polylactic acid (PLA). It is investing ₹1,750 crores to set up an 80,000-tonne bio-based PLA plant. This plant will likely go live in Q3FY27 and is expected to generate annual revenue of ₹2,000 crore, with a margin of 35%.
Backed by UP’s bioplastics policy, the plant will cater to segments such as caps, straws, blister packs, and textiles. These products are less price-sensitive and will help reduce dependence on regulated ethanol pricing and cyclical sugar prices, giving the business a more stable earnings profile over time.
#2. EID Parry: A diversification play
EID Parry is one of India’s oldest sugar companies, but its business model today looks very different from the typical sugar-cycle narrative. Over the past few years the company has been diversifying into ethanol, consumer products, and nutraceuticals.
Revenues held steady, but bottom line under pressure
In FY25, EID Parry reported a 13% rise in standalone revenue to ₹3,168 crore, led by growth in ethanol and consumer segments. However, the company posted a net loss of ₹428 crore, mainly due to a one-time ₹427 crore impairment related to its sugar refinery subsidiary. Margins also contracted by 300 basis points.
But diversification beyond sugar is helping the company. Distillery accounts for 35% of revenue, up from 13% four years ago. The consumer products division, which only began contributing in FY24, now makes up 28% of revenue. This diversification is likely one reason this stock has remained strong while its peers have been faltering.
Consumer business scaling up, still in investment mode
EID Perry’s diversification into consumer products is also contributing to its outperformance. These include both sweeteners and staples such as pulses and millets. The company is building this segment with a focus on its south India’s distribution strategy.
In FY25, the segment contributed ₹884 crore in revenue, growing 65% year-on-year. However, it posted a loss of ₹58 crore, up from ₹35 crore in FY24, as the company continued to invest in expanding its retail reach and brand visibility. Its distribution reach has expanded 10-fold in the past four years, and management expects to clock more than 12% annual growth from this segment in the near term.
For now, this division isn’t profitable. Still, the diversification into consumer product business is helping the company reduce its reliance on the cyclical sugar and ethanol business. That visibility, even if at an early stage, has become another driver for the company’s stock.
Sugar: operational efficiency but margin compression
EID Perry’s sugar segment performance in FY25 was also relatively weak as its crushing volumes declined to 17.4 million tonnes. But recovery improved slightly to 10.8%, helped by better weather in the south. Average sugar realisations rose modestly to ₹38.9 per kg, but a 7.5% increase in cane procurement costs squeezed margins.
Sugar revenue fell 13% and the segment reported a PBIT loss of ₹86 crore, compared to a profit of ₹34 crore the previous year.
Distillery: revenue grows, pressure on profitability
The distillery segment was an outlier. Revenue rose 38% year-on-year to ₹1,102 crore, aided by stable volumes and stronger ethanol realisations of ₹67 per litre. Regional price advantages in Tamil Nadu and Karnataka supported it.
However, rising FRP and stagnant ethanol procurement prices from oil marketing companies (OMCs) eroded margins. PBIT halved to ₹37 crore, and segment margin dropped to 3.3% from 8.3% a year ago. This was still lower than that of peers such as Triveni.
Its flexible distillery setup, which can switch between molasses and grain, gave it an edge. That adaptability is likely one of the reasons the stock has held investor interest through the ethanol pricing uncertainty of FY25.
Valuations are also in favour of both EID Parry and Balrampur Chini Mills. They trade at a price-to-earnings multiple of about 27, lower than Triveni Engineering’s 34. This valuation gap has also driven the stocks higher in the past few months.
For more such analysis, read Profit Pulse.
About the author: Madhvendra has over seven years of experience in equity markets and has cleared the NISM-Series-XV: Research Analyst Certification Examination. He specialises in writing detailed research articles on listed Indian companies, sectoral trends, and macroeconomic developments.
Disclosure: The writer does not hold the stocks discussed in this article.
The purpose of this article is only to share interesting charts, data points, and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educational purposes only.
