Godavari Biorefineries Limited

GBL belongs to the Somaiya group, which is among the oldest and well-established industrial houses in India with diversified interests in sugar and its allied products, alcohol and bulk organic chemicals, bio-based specialty chemicals, healthcare, social welfare and education, including the Somaiya group of institutions, among others. The promoters have demonstrated their willingness to financially support the company in the past. GBL was established by Late KJ Somaiya in 1939 as The Godavari Su

GBL operates a fully integrated sugarcane processing facility at Sameerwadi, Karnataka, which houses sugar cane crushing, distillery, and co-generation power units. Additionally, the company runs a bio-based chemicals manufacturing plant at Sakarwadi, Maharashtra. The strategic location of these facilities in Maharashtra and Karnataka , regions known for high-recovery sugarcane, provides operational advantages over other parts of India. In FY25, the company achieved a gross recovery rate of 10.9

GBL derives strength from its well -diversified product portfolio across the sugar value chain, encompassing sugar, co -generation, distillery, and bio -based chemicals. This diversification mitigates concentration risk and provides resilience against the cyc lical nature of the sugar industry. In FY25, sugar, distillery, and biochemicals contributed 36% (FY24: 33%; FY23: 34%), 31% (FY24: 33%; FY23: 31%), and 29% (FY24: 30%; FY23: 32%) of total revenue, respectively, with the balance from power

On a consolidated basis, GBL’s TOI rose to ₹1,870.25 crore in FY25 (FY24: ₹1,686.67 crore), primarily driven by ~20% growth in the sugar segment and modest single -digit growth across other segments. This improvement was largely supported by higher sales volumes, complemented by be tter realisations. With the reinstatement of sugar exports and increasing consumption , revenue from the sugar division is expected to maintain its upward trajectory. Additionally, despite India achieving 20% ethanol

GBL’s debt coverage metrics , as reflected by total debt/PBILDT and PBILDT interest cover of 4.93x and 1.45x, respectively, in FY25 (PY: 5.53x and 1.77x, respectively), remain lower than rating category benchmarks primarily due to subdued operating profitability and relatively higher reliance on borrowings . While the overall gearing improved to 0.94x as on March 31, 2025 (PY: 2.79x) with substantial prepayment of term loans from IPO proceeds in FY25, incremental borrowings to fund the ongoing c

Being seasonal in nature, t he sugar industry has high working capital requirements in the peak season, which is from November to April, to procure their primary raw material, sugarcane and manufacture sugar in this period. Moreover, the farmers’ dues need to be cleared in a timely manner owing to regulatory oversight, increasing the overall working capital intensity of operation s. GBL exports products on an advance basis and the collection period for the domestic sale of sugar to institutional

The company is undertaking a planned capex towards setting up a 200 kilo litres per day (KLPD) grain-based distillery and debottlenecking of existing manufacturing facilities, partly funded by incremental borrowings . The grain-based distillery project, with fungible feedstock capacity, is scheduled to be commercialised in Q1 FY27 and benefit the company in terms of diversification of ethanol feedstock, reduce dependence on sugar syrup/molasses, increase distillery capacity and enhance operating

The sugar industry directly depends on the sugarcane crop and its yield, and is susceptible to agro -climatic risks. Climatic conditions, more specifically, the monsoons, influence operational parameters for a sugar entity, such as the crushing period and sugar recovery levels. Also, the degree of dispersion of monsoon precipitation across the sugar -growing areas also leads to fluctuating trends in sugar production in different regions. CareEdge Ratings notes that while the gross recovery rates