India is gearing up to set a new target of 30% ethanol blending in petrol by 2030, having already achieved a ~20% blend by March of the current year.
Gulshan Polyols is a leading producer of Ethanol with a total capacity of 810 kilo liters per day (KLPD). Just a few years back, its capacity was only 60 KLPD.
For FY 25, the company sold 14 crore liters of Ethanol and is gearing up to sell 23-25 crore liters in FY 26. Below, we have shared notes from the Q4 FY 25 concall of the company to understand management’s views regarding the outlook for the business.
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Gulshan Polyols – Q4 FY 25 concall notes
Source: Gulshan Poly Q4 FY 25 presentation
Segmental Performance:
- Ethanol Segment
- Record performance in FY25, with 14 crore litres produced — more than 100% YoY growth
- Capacity ramp-up and higher volumes expected to continue, enhancing segment profitability
- Grain Segment
- Includes sorbitol, starch, and fructose — with fructose and sorbitol performing well, while starch remains a weak spot
- Hit by geopolitical disruptions and global realignments
- Mineral Segment
- Delivered stable, consistent performance
Ethanol Segment: Expansion & Incentives:
- Running at 70%, targeting 80-90% soon and aiming for 100% utilization (still working through operational challenges)
- State wise incentives:
- MP Plant: Rs. 1.5/litre incentive (approved, to be received soon)
- Assam Plant: Rs. 2/litre incentive (effective from May 2025, under NEIDP)
- Overall expected incentives: Rs. 40 crores/year for 7 years
- Interest Subvention Scheme (IS): 50% rebate on term loan interest (central government)
- Margins & Costs:
- EBITDA per litre: Rs. 4-5, varies with monthly raw material dynamics
- Full-year EBITDA margin guidance: 9-10%
- Raw Materials:
- Maize: Rs. 24-25/kg, conversion ~2.6-2.7 kg/litre of ethanol
- Rice: Rs. 25/kg, conversion ~2.23 kg/litre of ethanol
- Added by-product revenue of Rs. 6-7/litre
- FCI rice supply started from March at Rs. 20/kg — price correction pending for full benefit
Starch Business Challenges:
- The starch division is currently loss-making, mainly due to overcapacity in India
- Pre-COVID: India exported ~1 lakh tons of starch globally
- Post-COVID: China resumed starch exports, making India uncompetitive with lower global prices
- Sorbitol: Once a revenue driver, has seen margins erode from 17-18% EBITDA to current levels due to price drops and competition
- Maize prices are the highest in India, making exports unviable
Outlook & Strategic Focus for FY26:
- Revenue target: Rs 2300-2400 crores (vs Rs. 2000+ crore in FY25)
- Focus on ramping up ethanol segment and improving grain segment profitability via value-added products
- Continuing work with government for price relief and policy support (FCI rice, NEIDP, PLI)
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Ekansh Mittal
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