Balrampur Chini Mills Limited PLA structures reach 88% completion

Balrampur Chini Mills Limited said its 80,000-tonnes-per-annum poly lactic acid (PLA) project had about 88% of structures completed as of 15 October 2026, after expenditure of about Rs 2,397 crore, and remains targeted for commissioning in H2FY27. The project has gross capital expenditure of about Rs 3,080 crore and projected full-capacity revenue of about Rs 2,000 crore.

How far has BCML's PLA project progressed?

BCML reported that its physical construction had reached several advanced milestones by 15 October 2026: about 88% of structures were completed, 95% of tanks were erected or completed, and 72% of pumps were erected or completed. Piping work was 79% complete, while electrical work was 60% complete. More than 3,000 people were on site on average, according to the presentation.

The milestones show differing levels of completion across work packages. Tank erection or completion, at about 95%, was ahead of structural work at 88%, while electrical work at 60% remained the least-complete disclosed package. BCML also said analysis and product development were in full swing through imported PLA as construction continued. BCML describes the facility as India’s first biopolymer plant.

What is BCML spending and how is the PLA plant funded?

BCML had spent about Rs 2,397 crore on the project by 15 October 2026, against gross capital expenditure of about Rs 3,080 crore. BCML’s proposed funding plan comprises Rs 1,650 crore of debt and Rs 1,430 crore from equity and internal accruals, which together match the stated gross capital expenditure.

BCML said it raised Rs 450 crore through equity shares to fund a Rs 230 crore revision in capital cost. The presentation does not give a revised construction-completion date beyond its H2FY27 commissioning target, nor does it specify how much of the Rs 1,650 crore proposed debt had been drawn by 15 October 2026. The disclosed expenditure is therefore a project-spend update rather than a statement of final cost or final funding deployment.

What capacity and revenue does BCML expect from PLA?

BCML plans 80,000 tonnes per annum (TPA) of PLA capacity, increased from the earlier 75,000 TPA design, with revenue of about Rs 2,000 crore at full capacity. Commissioning is targeted in H2FY27, which is the second half of financial year 2027.

The full-capacity revenue figure is a project projection rather than reported sales. BCML had not begun commercial operations at the plant in the disclosed update, and its PLA segment instead reported a profit before interest and tax (PBIT) loss of Rs 15.43 crore in H1FY27, compared with a Rs 5.02 crore loss in H1FY26. The loss in Q2FY27 was Rs 5.58 crore, compared with Rs 1.01 crore in Q2FY26.

The segment’s disclosed costs show expenditure associated with developing the business before commercial production. Business development expense and free samples were Rs 5.05 crore in H1FY27, versus Rs 3.58 crore in H1FY26, while employee benefit expense rose to Rs 1.48 crore from Rs 0.59 crore. Depreciation was Rs 0.92 crore in H1FY27, compared with Rs 0.01 crore a year earlier.

Which Uttar Pradesh incentives could apply to BCML's PLA plant?

BCML’s project is eligible to receive incentives under Uttar Pradesh’s Bio Plastic Industrial Policy 2024, subject to commercial operations starting and to conditions in the Letter of Comfort issued by Invest UP. The state government announced the policy on 4 October 2024 for bioplastic manufacturers investing Rs 1,000 crore or more.

The policy provides for a 50% capital subsidy on eligible investment, disbursed over seven years after commercial production begins, and 5% interest subvention for seven years from commercial production. It also provides for 100% net State Goods and Services Tax (SGST) reimbursement for 10 years, electricity-duty exemption for 10 years, and stamp-duty exemption on land bought after 4 October 2024. Total incentives cannot exceed 200% of eligible investment.

The Letter of Comfort does not mean the incentives are unconditional or already received. For capital subsidy, the policy links the payment to a gross capacity utilisation multiple (GCM). The GCM is one in the first year if actual production reaches 40% of installed capacity, and is one in subsequent years if actual production reaches 75% of installed capacity. These production thresholds matter after the plant begins commercial operations.

What do the disclosed PLA costs say about the pre-commissioning phase?

BCML’s PLA segment recorded expenses and valuation movements before the plant’s targeted H2FY27 commissioning. In Q2FY27, business development expense and free samples were Rs 3.96 crore, employee benefit expense was Rs 0.83 crore, and other net expenses were Rs 2.77 crore. These items were part of the reported Rs 5.58 crore segment PBIT loss.

Interest-rate swaps (IRS) created a Rs 2.28 crore mark-to-market gain in Q2FY27, while the H1FY27 IRS mark-to-market line showed a Rs 2.29 crore loss. BCML said the accounting treatment was notional and required by Indian Accounting Standard 109 (Ind AS 109), and that the IRS contract had a favourable carry of about 43 basis points at the time of the presentation. Foreign-exchange translation and forward-contract movements produced a Rs 0.45 crore loss in H1FY27, compared with a Rs 0.69 crore gain in H1FY26.

Conclusion

BCML’s update places the PLA project in a late construction stage, with structures 88% complete and tanks 95% erected or completed, while Rs 2,397 crore had been spent by 15 October 2026. The project’s scale is defined by Rs 3,080 crore of gross capital expenditure, 80,000 TPA of planned capacity and management’s estimate of about Rs 2,000 crore in revenue at full capacity.

The next disclosed milestone is commissioning in H2FY27. Readers will also need to watch commercial production, because the Invest UP Letter of Comfort makes incentive receipt conditional on operations beginning and other stipulated conditions, while capital-subsidy eligibility is tied to 40% first-year and 75% subsequent-year production thresholds.