| Established track record along with experienced management
Established in 2006, Jai Hind Sugar Private Limited (JHSPL) is engaged in sugar manufacturing with integrated operations across the sugar–ethanol–cogeneration value chain. The company operates a sugar complex at Achegaon, Solapur, comprising a 4,900 TCD licensed crushing capacity (enhancement to 7,500 TCD under process), a 36 MW cogeneration plant and a 120 KLPD distillery, along with the acquired Gangapur unit having 2,000 TCD crushing capacity and a 30 KLPD distillery. The Achegaon unit is located in the sugar-rich Solapur region, while the Gangapur unit benefits from strong sugarcane availability and good connectivity to major markets through the Samruddhi Expressway. Promoted by Mr. Ganesh Mane Deshmukh, who possess over three decades of industry experience, the company maintains relationships with over 15,000 farmers. Acuite believes JHSPL's established track record, integrated business model and experienced management will continue to support its operational performance and growth prospects.
Improving scale of operations albeit volatile in profitability
The company's revenue improved to Rs.592.93 Cr. in FY26 (Prov.) from Rs.560.72 Cr. in FY25 and Rs.307.89 Cr. in FY24, supported by improved sugar realizations, recovery in ethanol operations and benefits from its integrated sugar–ethanol–cogeneration model. EBITDA increased to Rs.80.08 Cr. in FY26 (Prov.) from Rs.67.06 Cr. in FY25 and Rs.61.10 Cr. in FY24, while EBITDA margins improved to 13.51% in FY26 (Prov.) from 11.96% in FY25, aided by higher crushing volumes, improved ethanol production and better operational efficiencies. PAT recovered to Rs.10.39 Cr. (1.75%) in FY26 from Rs.2.51 Cr. (0.45%) in FY25 and Rs.5.37 Cr. (1.74%) in FY24, supported by stronger operating performance and improved realizations. Going forward, the company is expected to benefit from improving sugar realizations, higher cane availability, commencement of the 30 KLPD Gangapur distillery and continued support under the Ethanol Blending Programme. Acuite believes that JHSPL's integrated operations and increasing contribution from ethanol are likely to support growth in revenues and profitability over the medium term.
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| Moderate financial risk profile
The financial risk profile of JHSPL is moderate, characterized by an improving net worth, moderate leverage and weak debt protection metrics. The company's adjusted net worth improved to Rs.206.54 crore in FY26 (Prov.) from Rs.172.31 crore in FY25 (Rs.169.97 crore in FY24), supported by profit accretion and promoter funded subordinated unsecured loans considered as quasi-equity. The debt levels of company remain high driven by debt funded capex and working capital borrowings keeping gearing and Debt/ EBITDA at high levels of 2.46x and 6.22x as on March 31, 2026 (Prov.). Debt protection metrics remain weak with interest coverage ratio (ICR) at 1.51x in FY26 (Prov.) and debt service coverage ratio (DSCR) at below unity over the past three years, reflecting sizeable repayment obligations and high working capital requirements. Acuite believes JHSPL's financial risk profile will improve over the medium term supported by growth in net cash accruals and absence of any further debt funded capex requirements which remains a key rating monitorable.
Intensive working capital operations
The working capital operations of the company remain intensive, as reflected by gross current asset (GCA) of 282 days in FY26 (Prov.) as against 257 days in FY25 and 562 days in FY24. The high working capital requirement is primarily driven by inventory holdings, with inventory days at 192 days in FY26 (Prov.) compared to 157 days in FY25 and 446 days in FY24, owing to the seasonal nature of sugar production, inventory accumulation during the crushing season and phased sales throughout the year. Debtor days remained moderate at 55 days in FY26 (Prov.) as against 56 days in FY25 and 146 days in FY24, reflecting improved collections and normalization in sales. Creditor days stood at 58 days in FY26 (Prov.) compared to 47 days in FY25 and 230 days in FY24. Consequently, the working capital cycle remained elongated at 190 days in FY26 (Prov.) (FY25: 166 days), leading to continued reliance on short-term borrowings. Acuite believes that the working capital operations of the company are expected to remain intensive, given the inventory-driven nature of the sugar industry and seasonal procurement cycle, though supported by improving realizations, ethanol sales and expected subsidy inflows.
Agroclimatic risks and susceptibility of profitability margins to government regulations
Being an agro-based industry, JHSPL's operations are dependent on sugarcane availability and recovery, which are susceptible to monsoon patterns, rainfall and climatic conditions. Adverse weather conditions can affect cane availability, crushing volumes and profitability, as witnessed during FY25. Further, the sugar industry remains highly regulated, with government interventions relating to FRP for sugarcane, sugar export policies, ethanol diversion norms and blending policies, which can impact realizations and margins. The company's performance was affected during FY24 due to restrictions on sugar exports and ethanol production from B-heavy molasses. However, JHSPL's integrated presence across sugar, ethanol and cogeneration operations, coupled with benefits from the Ethanol Blending Programme, provides partial mitigation against cyclicality in sugar prices and regulatory risks. Acuite believes that profitability will remain susceptible to agro-climatic and regulatory risks, albeit partly supported by the company's diversified revenue profile and growing ethanol business.
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