DWARKESH · price
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Dwarikesh Sugar reported Q4 FY26 PAT of ₹57.41 crore, up 24% YoY despite lower revenue of ₹426.74 crore, driven mainly by a lower effective tax rate under the new tax regime rather than operational improvements. For full year FY26, PAT rose 32% to ₹30.84 crore on revenue of ₹1,409.09 crore. The company faced multiple headwinds including a ₹30/quintal increase in State Advised Price (SAP) for sugarcane, lower cane availability due to excessive rainfall and crop variety issues, and sluggish ethanol off-take declining 29% in Q4. Management highlighted improved farmer engagement and new cane varieties as growth levers for FY27, with focus on restoring crushing volumes and capacity utilization.
PAT growth appears inflated by tax benefits; underlying operations weakened due to higher cane costs and lower ethanol volumes. The positive forward guidance on cane availability signals potential recovery, but near-term margin pressure from SAP increases remains a concern for shareholders.