Sakthi Sugars slips to loss; hit by sugar price fall

MUMBAI: Sakthi Sugars Ltd said on Wednesday it slipped to a loss in the quarter to September, hit by sliding sugar prices.

The company, which has a capacity to crush 13,500 tonnes of cane a day, said average price realisation fell to 1,192 rupees a tonne in the quarter from 1,169 rupees a year ago.

Sakthi, which is expanding power generation capacity to insulate its results from the vagaraies of the sugar trade, reported a net loss of 216 million rupees in the quarter, compared with a net profit of Rs 99.5 million a year ago.

Net sales in the quarter fell by nearly a tenth to Rs 1.72 billion. "We are at the bottom of the cycle. Prices should start rising in six months," Managing Director M.Manickam said on televison channel CNBC TV 18. The company has just comissioned a 25 megawatt power plant and is building two more, which would raise power generation capacity to 120 megawatt by March 2008.

"Numbers will look different from next year on, as revenue and profit from power will increase," a company spokesman said. Sakthi's sugar segment reported an operating loss of 295 million rupees, while its power and alchohal segments made an operating profit of Rs 293 million, he said.

Shares in the company were 0.4 per cent up at Rs 77 in the Mumbai market.