K.C.P. Sugar first-half profit rise driven by other income

K.C.P. Sugar and Industries Corporation Limited reported consolidated profit after tax of Rs 85.57 crore for the half year ended September 30, 2026, compared with Rs 19.57 crore a year earlier, with a Rs 71.57 crore rise in other income to Rs 95.49 crore accounting for most of the Rs 75.03 crore increase in profit before tax.

Why did K.C.P. Sugar’s first-half profit rise?

K.C.P. Sugar’s first-half profit rose principally because other income increased sharply. Consolidated profit before tax rose to Rs 100.48 crore in the half year ended September 30, 2026, from Rs 25.45 crore a year earlier, while profit after tax increased by Rs 66.00 crore to Rs 85.57 crore. The company reported no exceptional items in either period.

Other income increased to Rs 95.49 crore from Rs 23.92 crore, a gain of Rs 71.57 crore. Revenue from operations also grew, rising by Rs 29.81 crore to Rs 156.38 crore, but total expenses increased by Rs 21.35 crore to Rs 151.38 crore. The increase in revenue from operations less the increase in expenses was Rs 8.46 crore, compared with the much larger movement in other income.

Tax expense rose to Rs 14.91 crore from Rs 5.88 crore, including deferred tax of Rs 13.76 crore against Rs 5.38 crore in the prior-year half. Consolidated basic and diluted earnings per share from continuing operations were Rs 7.55, compared with Rs 1.73. The filing reported no discontinued operations in either first-half period.

What do K.C.P. Sugar’s segment results show?

K.C.P. Sugar’s segment results improved, but they did not account for the full increase in consolidated pre-tax profit. The segment-profit subtotal, measured before interest and tax, increased to Rs 14.31 crore from Rs 6.71 crore, a rise of Rs 7.60 crore. This was materially smaller than the Rs 75.03 crore increase in consolidated profit before tax.

The segment reconciliation showed other unallocable expenditure net of unallocable income at negative Rs 91.09 crore, compared with negative Rs 22.88 crore a year earlier. That Rs 68.21 crore movement broadly accounts for the gap between the improvement in segment profit and the increase in consolidated profit before tax. The filing does not separately explain the components of this reconciliation line in the segment table.

Sugar was the largest reported profit segment, recording Rs 8.35 crore for the half year, compared with Rs 2.21 crore a year earlier. Sugar revenue increased to Rs 85.33 crore from Rs 74.23 crore. Engineering profit rose to Rs 4.63 crore from Rs 4.08 crore, while its revenue increased to Rs 28.59 crore from Rs 21.43 crore.

Chemicals remained loss-making at the segment level, with a Rs 1.82 crore loss compared with a Rs 1.69 crore loss in the previous first half, despite revenue rising to Rs 11.87 crore from Rs 7.03 crore. The Others segment reported profit of Rs 3.07 crore against Rs 2.11 crore, and Power and Fuel reported Rs 0.08 crore against Rs 0.003 crore. No Power and Fuel revenue was reported for either first-half period.

How did K.C.P. Sugar’s second quarter compare with the first?

K.C.P. Sugar’s consolidated September-quarter profit was lower than its June-quarter profit but far above the prior-year quarter. Profit after tax was Rs 39.32 crore for the quarter ended September 30, 2026, compared with Rs 46.25 crore for the quarter ended June 30, 2026 and Rs 0.42 crore a year earlier. Profit before tax was Rs 46.31 crore, versus Rs 54.18 crore in June and Rs 0.92 crore a year earlier.

Other income was Rs 39.96 crore in the September quarter, down from Rs 55.52 crore in the June quarter but above Rs 1.21 crore in the September 2025 quarter. Revenue from operations was Rs 78.35 crore, marginally higher than Rs 78.03 crore in June and above Rs 67.20 crore a year earlier. Total expenses fell sequentially to Rs 72.01 crore from Rs 79.38 crore.

Sugar segment profit increased sequentially to Rs 6.20 crore from Rs 2.14 crore, while engineering segment profit rose to Rs 3.28 crore from Rs 1.35 crore. The chemicals segment reported a Rs 0.85 crore loss, compared with a Rs 0.97 crore loss in June and a Rs 0.86 crore loss a year earlier. K.C.P. Sugar said sugar is seasonal and predominantly cyclical, so quarterly results should not be construed as indicators of annual operations or inter-period comparisons within a financial year.

What do K.C.P. Sugar’s cash flow and balance sheet show?

K.C.P. Sugar generated Rs 86.02 crore of consolidated cash from operations in the half year ended September 30, 2026, compared with cash used in operations of Rs 45.04 crore in the year ended March 31, 2026. The half-year cash-flow statement included an Rs 89.69 crore fair-value adjustment, an Rs 86.06 crore inventory-related cash release and an Rs 16.65 crore trade-receivables release.

Other current assets absorbed Rs 47.11 crore of cash, while changes in current investments released Rs 33.22 crore. Investing activities used Rs 35.30 crore, including Rs 35.16 crore used in changes in margin-money deposits. Financing activities used Rs 58.73 crore, including Rs 52.74 crore of net repayments of long-term and short-term borrowings and Rs 4.85 crore of interest paid.

Consolidated cash and cash equivalents stood at Rs 19.75 crore on September 30, 2026, compared with Rs 14.85 crore on March 31, 2026. Total consolidated assets increased to Rs 707.91 crore from Rs 659.76 crore. Inventories declined to Rs 69.72 crore from Rs 155.78 crore, while investments increased to Rs 295.37 crore from Rs 205.14 crore.

Consolidated current borrowings fell to Rs 22.49 crore at September 30, 2026, from Rs 92.16 crore at March 31, 2026. Non-current borrowings increased to Rs 52.47 crore from Rs 35.55 crore over the same dates. This shift occurred alongside the Rs 52.74 crore net borrowing repayment reported in the half-year cash-flow statement.

Conclusion

K.C.P. Sugar’s first-half result combined higher operating revenue, an improvement in sugar and engineering segment profit, and a large rise in other income. The Rs 71.57 crore increase in other income was close to the Rs 75.03 crore increase in pre-tax profit, while segment-profit growth was Rs 7.60 crore and chemicals remained loss-making.

The next results will show whether sugar, engineering and chemicals sustain their first-half trends through the seasonal cycle. K.C.P. Sugar also disclosed that the basic value of its contract with The EIMCO-KCP Limited was reduced to Rs 102 crore from Rs 130 crore after The EIMCO-KCP Limited placed a direct order of about Rs 28 crore for SS 2507 plates that were unavailable for procurement in India.