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BUSINESS SEGMENT REVIEW

SECURING RESILIENCE AND LONG-TERM GROWTH

In a year marred with unprecedented challenges of feedstock availability, we persisted and focussed on strengthening our competitive edge. Through expanding capacities and driving operational efficiencies, optimising portfolio mix and securing sugarcane availability for the next season, we have positioned ourselves for growth. Our focus on farmer empowerment and agriculture self-sufficiency remained unwavering, through our efforts around sugarcane development and leveraging digital technologies to improve farm yields.

Key highlights FY 24

Sugarcane crushed (SS)

8.26 million tonnes

Sugar produced (SS)

8,90,126 tonnes

Gross sugar recovery (SS)

11.49%

Net sugar recovery (SS)

10.78%

Average blended realisation (FY)

₹ 38,175/MT

Revenue (FY)

₹ 3,857.9 Crore

PBIT (FY)

₹ 305.6 Crore

Sugarcane crushed, Sugar produced and Recoveries pertain to Sugar Season (SS) 2023-24

We faced several operating challenges in FY 24, primarily from climatic factors, disease spread and policy decisions. Undaunted by these, we continued with capex plans and focussed on future readiness. We completed various modernisation, debottlenecking and efficiency improvement projects which increased sugarcane crush capacity, reduced process steam consumption and enhanced refined sugar production to ~70%. Sugarcane planting for the next season with better and more resilient varieties was also achieved which is poised to enhance sugarcane availability and quality. We proudly supported several farmers with our advanced farm technologies, and have identified several digital projects to scale impact.

Headed into FY 25, our fundamentals are strong, and through a combination of favourable macro environment, policy decisions and company-wide efforts, we expect to improve performance. We will continue judiciously investing in enhancing crush rate, sugar quality and efficiencies.

Sameer Sinha CEO - Sugar Business

Performance highlights FY 24

  • Faced sugarcane availability shortage as yields were impacted by heavy rainfall, water logging, inclement weather and spread of red rot disease in Co0238 varieties along with some diversion of sugarcane to kolhus/crushers
  • Sugarcane crush declined 11%; four of seven units including Deoband, Chandanpur, Rani Nangal and Milak Narayanpur saw a major decline
  • Sales volume impacted due to lower monthly releases by the Government under quota mechanism and export restrictions; exports were lower by 87.6%
How TEIL exhibited resilience in FY 24
  • Carried out operations with C-heavy molasses amidst restrictions on use of B-heavy molasses and sugar sacrifice for ethanol production
  • Enabled a 5.8% increase in average blended realisations, led by sugar price increases and change to refining process (DRP) at Milak Narayanpur, in addition to Khatauli, Sabitgarh & Deoband facilities, leading to increase in premium refined portfolio from ~60% to ~70%
  • Ensured steady sugarcane crush in Khatauli and Sabitgarh units which had no instances of red rot disease
  • Ramkola unit proactively reduced Co0238 sugarcane varietal plantation due to incidence of red rot diseases in the previous season, shifting to other varieties to mitigate impact and ensure healthy sugarcane availability
How TEIL is investing in a better tomorrow
  • Structured varietal substitution programme underway across our cane area to reduce dependence on the vulnerable Co0238 variety, by switching to other high sucrose and high-yield varieties. The Company has reduced its dependence on Co0238 variety from 98% a few years ago to 77% in current season and endeavours to reach 50-55% in the upcoming season.
  • Completed modernisation and debottlenecking capex initiatives at various units:

    - Deoband unit installed falling film evaporators to reduce process steam consumption

    - Sabitgarh unit made changes in the boiling house to enhance cane-crushing capacity

    - Rani Nangal unit installed new small-capacity boiler along with turbines to meet utility requirements

  • Sabitgarh unit initiated project to expand sugarcane crushing capacity by 2,000 TCD to 9,000 TCD which will enhance the total crushing capacity to 63,000 TCD by SS 2024-25.

Ramkola unit outperforms and sets a precedent

In a year marked by weather and disease-related challenges, our Ramkola unit demonstrated immense resilience and foresightedness. The unit, with a cane command area in low-lying areas, experienced marginal incidences of red rot disease in the previous season. Proactively, the unit implemented a structured varietal substitution programme in the spring planting season, replacing the vulnerable Co0238 varieties with CoP9301. When red rot disease again spread in SS 2023-24, this unit’s sugarcane command area remained virtually uninfected, becoming the only one at TEIL to register an increase in cane crush and recovery over the previous season.

Considering the success, similar varietal substitutions were undertaken across other units, with the support and guidance of the Ramkola unit’s team.

Ramkola sugarcane crushing success

ACTIVE PARTNER IN ETHANOL BLENDED PETROL (EBP) PROGRAMME

The Government’s EBP programme has been a game-changing move helping the nation address the dual challenge of reducing dependence on imported crude oil and climate change by lowering vehicular emissions. We are proactively participating in this through accelerated expansion of our ethanol capacities. Alongside, we have unlocked new revenue opportunities by forward-integrating into the liquor business and creating market linkages for by-products.

Key highlights FY 24

Alcohol produced

1,84,351 KL

Alcohol sales

1,82,707 KL

IMIL Sales

44.73 lakh cases

Average realisation

₹ 59/litre

Revenue (net of excise duty)

₹ 1,273.6 Crore

PBIT

₹ 180.9 Crore

Alcohol sales from sugarcane : grain-based feedstocks

67% : 33%

We exhibited resilient performance despite several feedstock challenges which impacted planned production. Amidst restrictions on traditional feedstocks, our team exhibited immense agility in experimenting with maize as feedstock and deploying it into ethanol production. Our long-term strategy is to grow operations by actively partnering in India’s Ethanol Blended Petrol (EBP) programme and self-reliance journey. Aligned with this, we recently expanded aggregate distillation capacity to 860 KLPD, aiming to reach 1,110 KLPD. We also progressed on our forward integration strategy, expanding the Indian Made Indian Liquor (IMIL) business and venturing into the new premium Indian Made Foreign Liquor (IMFL) business for which a bottling plant is being set up.

Sameer Sinha CEO - Sugar Business

Performance highlights FY 24

  • Faced significant feedstock challenges due to suspension of surplus rice supplies by the Food Corporation of India and restrictions on B-heavy molasses usage, necessitating introduction of Maize as feedstock which led to lower operating capacities and production
  • Margins were impacted due to low-margin maize operations and volatility in its prices
How TEIL navigated challenges with agility in FY 24
  • Carried out operations with C-heavy molasses and maize as feedstocks amidst challenges in the availability of B-heavy molasses and FCI rice
  • Leveraged the multi-feed Milak Narayanpur facility and grain-based Muzaffarnagar facility to seamlessly transition to maize feedstock, becoming among the first few in India to manufacture ethanol using this route and supplying it to Oil Marketing Companies (OMCs)
  • Scaled up dispatches of IMIL by 34% to 44.73 lakh cases which helped improve product mix and achieve higher turnover
How TEIL is investing in a better tomorrow
  • Commissioned 200 KLPD Rani Nangal plant (in May 2024), enhancing total distillery capacity to 860 KLPD, which includes two multi-feed units, two molasses-based units and one grain-based unit, giving significant operational flexibility in feedstock usage
  • Active participation in the Government’s EBP Programme aimed at increasing bio-ethanol blending in petrol to 20% by FY 26; OMCs have already floated tenders for ₹ 825 crore litres in Ethanol Supply Year (ESY) 2023-24 (Nov-Oct) targeted at 15% blending
  • Plans to increase captive consumption of alcohol for value-added forward integration projects, including production of IMIL and the newly launched premium IMFL segment; a modern IMFL bottling plant being set up in Muzaffarnagar with expected commissioning in H1 FY 25. Focus on continued enhancement of revenues from value-added propositions such as:

    - Distillers Dried Grain Solubles (DDGS), a by-product of grain-based operations with high protein content

    - Potash-rich ash generated from using Slop in incineration boilers

    - CO2, a by-product in the fermentation process of alcohol manufacturing

EXPANDING HORIZONS TO SEIZE GLOBAL OPPORTUNITIES

We are a prominent player in India’s high-speed gears market with proven capabilities in manufacturing energy-efficient, high-power and high-speed products and providing aftermarket services. With installations spanning over 80 countries and a strong global potential, the business also has an enhanced focus on international growth. Our Defence business riding on India’s indigenisation journey has emerged as a preferred supplier to the Indian Navy and Indian Coast Guard with superior technologies and capabilities. We are now investing in capacities and manpower, R&D capabilities and technologies to capitalise on the growing Indian economy and industrialisation opportunities, while also leveraging our solid foundation to power our global growth aspirations.

Key highlights FY 24

No. of Gearboxes sold

461

Order booking

₹ 375.4 Crore

Closing order book

₹ 287.4 Crore

PBIT

₹ 107.1 Crore

Revenue

₹ 291.8 Crore

The Power Transmission business scaled new heights in FY 24. The year was marked by extensive efforts to exhibit competencies and build relations with international customers with sustained investments in R&D and infrastructure creation. Considering the potential in both our gears and defence businesses, we augmented our investments and intend to further enhance manpower, R&D efforts and digital technology adoption. In gears, we aim to leverage our proven value propositions of reducing life cycle costs and providing world-class quality, to expand our products and aftermarket solutions globally. The Defence business is equally attractive with increased capital outlay from the Government. We are setting up a dedicated multi-modal facility and intend to enhance service offerings and order booking.

Rajiv Rajpal CEO - Power Transmission

Performance highlights FY 24

  • Business reported strong performance, with new milestones in revenues, profitability and order booking
  • Witnessed healthy demand for our products, including high-technology compressor gearboxes, high-power small hydro turbine applications, high‑power API gearboxes, etc.
  • Won prestigious orders in 40 MW and above power ranges, including that of API standards, from South American and European customers
  • Saw order bookings in high power small hydro turbine applications, helping sustain market share across high-speed applications in both products and aftermarket segments

Our legacy of R&D excellence

2007

Integrally geared compressor gearbox development

2008

Developed vertical offset horizontal shaft vertical offset hybrid hydro high power gearbox

2009

Developed high power Frame 6 Gas Turbine gearbox

2011

Developed offset halve radial journal bearing for very high-speed application

2013

Developed Planetary gearbox for Sugar mill application

2014

Developed Bevel Planetary technology for Cement and Thermal power plants

2015

Numerical simulation of gear growth and distortion during heat treatment

2016

40MW highest power test rig gearbox developed for compressor testing

2019

Developed in-house Gear design software for gear sizing and optimisation

2020

Developed special profile bearings for very high-speed applications

2021

Developed 40 MW integrated load cum accessories train gearbox for gas turbine generator application

2023

Developed high efficiency gearbox for high-power high-speed application

Optimised oil flow to the gearbox and developed materials and metallurgy for high PLV gears

R&D efforts in FY 24

Development of high efficiency gearboxes for High-Speed High-power applications

We initiated a project in collaboration with a leading Indian university to improve the efficiency of high-power capacity of greater than 30 MW and pitch line velocity of greater than 120 metres per second, by 0.15 percentage points. The technology’s results have been validated and brought it on par with global competition.

Development of High-Speed High-power Compressor gearbox

Our international growth strategy necessitated introducing high speed, high power compressor gearboxes technology which can be horizontally deployed across multiple customers in high-potential global markets. Accordingly, we initiated a project in FY 24 for a 27 MW speed increaser compressor application for a European customer and validated it through testing. This technology is deployable for medium to high-power high-speed compressor applications utilising specialised bearings and materials.

Development of PTB’s Augment Reality Platform named as Xperia

This product showcases gearbox unique features and its benefits, provides immersive experience of installation and commissioning, reduce turnaround time, enriches troubleshooting knowledge using cause and effect simulations. Xperia App is developed to educate and showcase Steam Turbine, Gas Turbine, Planetary and Integral Gear compressor gearboxes using Android and iOS devices to all existing or potential end customers as well as to PTB employees. This product is aimed to provide ‘feel it own it’ experience, enhance brand value, improve product patronage along with user analytics.

How TEIL capitalised on the market opportunities

Undertook extensive international customer outreach to demonstrate capabilities and establish relationships

Continued investments in R&D and infrastructure, including expansion of capabilities to manufacture gear with 2.8 metres diameter, up from 2 metres, to capitalise on the global opportunity landscape and enhance market share

Executed key long-term initiative of establishing Centres of Excellence for Gear technology, Finite element analysis, Rotor dynamics, Fluid mechanics, Tribology, Vibration and noise analysis and Structural mechanics

Strengthened manpower to support growing operations and address market demand

How TEIL is investing in a better tomorrow

  • Executing an intense capex programme including a new bay (grinder/hobber/equipment), to enhance gears business capacity from ₹ 250 crore to over ₹ 500 crore and capitalise on significant domestic opportunity and international expansion
  • Leverage existing strong relations with multinationals in India to grow in international markets by proving technology and achieving qualifications; focus will be on Western Europe and the US where maximum OEMs are present
  • Expand international aftermarket business by leveraging our engineering products expertise and strong relations in the Asian subcontinent; service footprint being expanded in high-potential markets by hiring employees and expanding agent network to capture opportunities, especially retrofitting of existing installations
  • Focus on building on defence business, led by the progress made through qualifications and Request for Proposal (RFP) in gas turbine generator packaging, gearboxes and special application pump segments; a dedicated multi-modal facility is underway for propulsion systems of large surface ships or subsurface vessels to gain customer confidence and expand service offerings
  • Strengthen people strategy, tailored to the unique needs of the Gears (supporting capacity, international and aftermarket expansion) and Defence (scaling R&D, engineering capabilities) businesses
  • Intensify R&D for IP enhancement, international product development, product performance improvement and enhancing technology knowledge of high-efficiency gearboxes and high-speed materials; an R&D laboratory is being developed to expedite specialised product and technology launches

FOCUSSED ON GROWTH AND PROFITABILITY

Globally water shortage is a major crisis, with governments and agencies making continued investments to sustained growing urban landscape. As a leading player in Water & Wastewater solutions, we stand at the forefront of addressing the challenge with our diverse, impactful and innovative solutions. We continue to explore new opportunities while focussing on cost optimisation to create scalable impact and grow profitably.

Key highlights

Water & Wastewatertreated

12,000+ MLD

Pan-India Installations

1,500+

Projects executed

100+

Closing order book* FY 24

₹ 1,223.4 Crore

Revenue FY 24

₹ 246.3 Crore

PBIT FY 24

₹ 31.4 Crore

Current Projects in municipal and industrial areas

17

* including long duration orders of ₹ 879.8 crore for Operations & Maintenance (O&M)

The water and wastewater treatment solutions industry’s long-term prospects remain positive across global markets. With our competencies and credentials, we are well-placed to capitalise on upcoming opportunities. Our focus is on executing the existing order book, enhancing operational efficiencies, bringing in new technologies. We are also actively working towards capturing new business opportunities and enhancing our global presence.

Kamal Verma CEO - Water Business

Performance highlights FY 24

  • Business witnessed a muted period; revenue declined due to slower execution and finalisation in certain projects and order booking declined due to delay in awarding new projects, where we are the lowest bidders
  • Profitability was healthy due to cost optimisation and savings in various projects executed during the year

How TEIL is investing in a better tomorrow

Leverage success in India, Maldives and Bangladesh to identify new opportunities and expand in the overseas markets; actively target foreign projects with secured funding from multilateral and reputed agencies

Target domestic wastewater recycling and reuse, zero liquid discharge, sewage recycling, and attractive municipal opportunities across various states

Participate extensively in EPC and HAM (PPP) model projects, where the outlook is positive given the large investment commitments by the Central and State Governments

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