DOLLEX - Dollex Agrotech

📊 NSE: DOLLEX 🏢 Sugar 📅 Last Updated: 12/13/2025 21:38

💰 Financial Performance

Revenue Growth by Segment

Total revenue grew by 75.2% in FY2025 to INR 237.43 Cr from INR 135.59 Cr in FY2024. Growth was driven by incremental production in the manufacturing segment, specifically Khandsari Sugar, and supported by sugar trading. Revenue in FY2024 had previously grown 22.6% YoY from INR 110.53 Cr in FY2023.

Geographic Revenue Split

Operations are primarily centered in Indore and Datia, Madhya Pradesh, with 100% of manufacturing assets located in the state. Specific regional sales percentages are not disclosed.

Profitability Margins

Net Profit Margin (PAT) declined to 3.49% in FY2025 from 5.18% in FY2024. This compression was primarily due to a sharp rise in raw material (sugarcane) costs which outpaced revenue growth.

EBITDA Margin

EBITDA margin stood at 6.88% in FY2025, a significant contraction from 10.39% in FY2024 and 11.68% in FY2023. The 351 bps YoY decline in FY2025 reflects higher procurement costs for sugarcane.

Capital Expenditure

The company is executing a major debt-funded capex of INR 99.29 Cr to set up a 60 KLPD Ethanol plant in Datia, MP. Funding includes an INR 86.68 Cr term loan from IREDA and INR 12.16 Cr from equity/internal accruals.

Credit Rating & Borrowing

Long-term rating is 'ACUITE BBB-' with a 'Stable' outlook as of September 2025. The outlook was previously 'Negative' in June 2024 due to delays in capital infusion. Average fund-based bank limit utilization was 79.93% for the six months ending July 2025.

⚙️ Operational Drivers

Raw Materials

Sugarcane is the primary raw material, representing the bulk of manufacturing costs. Other inputs include chemicals for processing and packaging materials.

Import Sources

Sourced locally from farmers in Madhya Pradesh, particularly around the Indore and Datia manufacturing belts to ensure freshness and minimize transport costs.

Key Suppliers

Procurement is primarily from individual local farmers and agricultural cooperatives rather than large corporate suppliers.

Capacity Expansion

Current sugar crushing capacity is 2500 TCD (Tons Crushed per Day). A new 60 KLPD Ethanol plant is completed and awaiting departmental approvals, with commercial operations expected by December 2025 (FY2026). The plant features multi-feed technology allowing expansion to 120 KLPD.

Raw Material Costs

Raw material costs increased significantly in FY2025, leading to a drop in EBITDA margins from 10.39% to 6.88%. Procurement strategies involve providing subsidized insecticides and educating farmers to improve cane quality and yield.

Manufacturing Efficiency

The sugar plant operated at 98% capacity utilization in FY2024, running for 125 days. The company aims to increase operational days to 140-150 to improve fixed cost absorption.

Logistics & Distribution

Distribution is managed through a network of traders and direct sales; costs are influenced by the proximity of the Datia and Indore plants to regional markets.

📈 Strategic Growth

Expected Growth Rate

25-30%

Growth Strategy

Growth will be achieved through the commencement of the 60 KLPD ethanol plant in Q3 FY2026, which diversifies revenue away from cyclical sugar. The company also raised INR 49.44 Cr via a Rights Issue in June 2025 to strengthen the balance sheet and fund the transition to a multi-product agro-processing model.

Products & Services

White Sugar, Jaggery (Gur), Khandsari Sugar, and upcoming Ethanol (fuel grade).

Brand Portfolio

Dollex Agrotech.

New Products/Services

Ethanol production is the primary new launch, expected to contribute significantly to the topline from FY2026 onwards.

Market Expansion

Expansion is focused on the Ethanol blending market in India, targeting OMCs (Oil Marketing Companies) as primary off-takers.

Strategic Alliances

The company has a reverse merger history with Parvati Sweeteners And Power Limited; no current JVs are disclosed.

🌍 External Factors

Industry Trends

The industry is shifting toward the 'Sugar-to-Ethanol' model encouraged by the Government of India's Ethanol Blending Program (EBP), which aims for 20% blending. This shift provides a more stable, non-cyclical revenue stream compared to traditional sugar manufacturing.

Competitive Landscape

Competes with other regional sugar mills in Madhya Pradesh and large integrated players like Parvati Sweeteners.

Competitive Moat

Moat is based on the 'catchment area' advantage (proximity to sugarcane farmers) and the high capital cost of setting up integrated sugar-ethanol plants. Sustainability is linked to the 10+ years of promoter experience in the Indore region.

Macro Economic Sensitivity

Highly sensitive to agricultural GDP and monsoon performance. A deficit monsoon can reduce raw material availability by over 20%.

Consumer Behavior

Increasing demand for ethanol as a green fuel and steady domestic demand for sugar and jaggery.

Geopolitical Risks

Low direct impact, though global sugar price fluctuations can influence domestic regulatory policy on exports.

⚖️ Regulatory & Governance

Industry Regulations

Operations are heavily regulated by the Essential Commodities Act, including monthly sugar release quotas and government-fixed sugarcane prices (FRP).

Environmental Compliance

Ethanol plants require stringent 'Zero Liquid Discharge' (ZLD) compliance; costs are integrated into the INR 99.29 Cr project cost.

Taxation Policy Impact

Subject to standard corporate tax rates; ethanol production often benefits from lower GST rates (5%) to encourage green fuel.

Legal Contingencies

No specific pending court cases or values disclosed in the provided documents.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the timing of departmental approvals for the ethanol plant; any delay beyond December 2025 will defer expected revenue growth and impact debt servicing.

Geographic Concentration Risk

100% of manufacturing revenue is concentrated in Madhya Pradesh, making the company vulnerable to state-specific agricultural policies or regional weather patterns.