Sakthi Sugars shares drop nearly 2% after Q4 net profit declines 51%

The company reported a sharp 51% drop in net profit at ₹107.5 crore for the quarter ended March 31, 2024, as compared to net profit of ₹220 crore in the same period a year ago.

Sequentially, however, Sakthi Sugars performed well on the profit front, given a net loss of ₹42.65 crore reported in the December 2023 quarter.

The company’s revenue from operations witnessed a downward trend in the March quarter at ₹298.8 crore, a decrease of 8.5% year-on-year (YoY) from ₹326.76 crore in the final quarter of the previous financial year.

On the other hand, the revenue from operations made a stellar growth of 93.3% on a quarter-on-quarter (QoQ) basis in Q4FY24 as opposed to ₹154.57 crore in the preceding quarter.

Sakthi Sugars approved the sale of sugar and distillery units located at Dhenkanal, Odisha, and Soya unit in Pollachi, Tamil Nadu, during the financial year 2023-24 at competitive prices in order to raise funds for reducing liabilities.

During the said financial year, the company also sold its Soya unit at Pollachi for a consideration of ₹124.5 crore on a slump sale basis, which led to recognition of ₹14.43 crore as profit on the disposal of this Soya unit.

The company sold its sugar and distillery units at Dhenkanal for a consideration of ₹134.1 crore in FY24, conducted on a slump sale basis, recognising ₹56.2 crore as profit on the disposal of the said units.

The company’s shares closed 0.6% lower at ₹32.5 per piece on May 29, 2024, with a market capitalization of ₹386 crore.