Bajaj Hindusthan Sugar’s (BHSL) board on Thursday approved evaluating various options for capital restructuring of the company, including merging of power businesses and demerger of certain businesses. The restructuring — which also includes resolution plans for debt — is to streamline the corporate structure and enhance stakeholders’ value, BHSL said in a regulatory filing.
The board has delegated powers to the officers of the company to explore and evaluate various options in consultation with advisors, it said, but did not provide any further details of its proposed restructure. Mumbai-headquartered BHSL, a part of Bajaj Group (Kushagra Bajaj), has a sugarcane crushing capacity of 1.36-lakh tonne cane per day, six distilleries with capacity to produce 800 kilolitres of industrial alcohol per day and 14 co-generation plants having a total power generation capacity of 449 MW.
The company produces a total of 2,409 MW of power, including from its Lalitpur Power Generation Company in Uttar Pradesh. The firm’s gross debt was at 4,923 crore as of December 31, 2021, according to Bloomberg data. For the third quarter ended December 31, 2021, BHSL had posted a consolidated net loss of164.53 crore, a decrease from a net loss of 190.55 crore recorded during the same quarter a year ago. Its total income for the reporting quarter fell 28.61% to1,261.33 crore from 1,766.84 crore posted during the year-ago period. The company attributed its losses mainly to high raw material cost, that is sugarcane and other input prices, and relatively lower realisation of sugar due to higher production. The company, in its third quarter report, said it had outstanding dues payable to cane farmers. The company has received1,000 crore in (two tranches of 500 crore each on January 21, 2022, and February 3, 2022) from Uttar Pradesh Power Corporation. The amount is to be paid to the sugarcane growers towards arrears for sugar season 2020-21 and 2021-22, it said. Following this payment, the company’s sugar cane dues would be about1,300 crore.