Best Ethanol Stocks in India in Oct 24 – Based on 5Y CAGR

India’s industrial ethanol production capacity stands at 13.80BL, with 8.75BL from molasses and 5.05BL from grain feedstocks as of April 2024.  In the pursuit of achieving 20% blending by 2025, the Indian government achieved a record 12% ethanol blending in FY 2024. To fight climate change and lessen dependency on foreign oil, the government is aggressively promoting biofuels like ethanol. 

The Ethanol Blending Program (EBP) in India is progressing well. States like Maharashtra, Karnataka, Uttar Pradesh, Punjab, Haryana, Sikkim, Bihar, and Madhya Pradesh have produced more ethanol than they could have imagined, boosting both energy independence and farmer empowerment. Additionally, these states are helping smaller states meet their demands for ethanol supplies. In this blog, let us look at the best ethanol stocks in October 2024:

Best Ethanol Stocks in October 2024 Based on 5-Year CAGR

Note: The above Ethanol Sector stocks have been selected from Nifty 500 Universe and sorted based on 5Y-CAGR as of September 26, 2024.

Overview of Best Ethanol Stocks

1. Triveni Engineering and Industries Limited: Triveni Engineering and Industries Ltd is an Integrated and diversified conglomerate in the areas of sugar, ethanol and engineering. During Q1 FY25, the company reported a growth of 12% in the Sugar segment revenues to just under ₹1,000 crore, driven by higher dispatches and 5% improved realisations.

Key Metrics

• ROE: 14.2%
• ROCE: 14.8%

2. Shree Renuka Sugars: Founded in 1995, Shree Renuka Sugars Ltd (SRSL) produces refined sugar, ethyl alcohol, and ethanol and generates and distributes electricity. During FY24, the company’s revenue surged by 26% to ₹1,08,981 million. The revenue growth was due to a stellar performance of its refinery division.

Key Metrics

• ROE: –
• ROCE: 10.2%

3. EID Parry (India) Ltd: EID Parry is engaged in Sugar, Nutraceuticals and ethanol production. It also has a significant presence in the Farm Inputs business, including Bio pesticides through its subsidiary, Coromandel International Limited. During Q1FY25, the standalone revenue from operations stood at ₹751 crores registering an increase of 7.58% over Q1 FY24.

Key Metrics

• ROE: 13.5%
• ROCE: 20.3%

4. Balrampur Chini Mills: Balrampur Chini Mills Limited manages its operations across three distinct segments: Sugar, Distillery, and Others. During the year ended March 2024, sugarcane crushing increased by ~16% and sugar production increased by ~27%. The company has dual feed capacity at one of our distilleries which has a daily distillation capacity of 330 KLPD.

Key Metrics

• ROE: 13.8%
• ROCE: 13.5%

Conclusion

As a multipurpose megafuel, ethanol has enormous potential. Its implementation could result in significant savings on the cost of oil imports and help protect the environment.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.