Recommendation CMP Target Price Time Horizon
Buy Rs. 218 Rs. 275 12 Months

Triveni Engineering & Industries Ltd. (‘Triveni’) is the second largest integrated sugar producer in the country. Its Sugar business consist production of Sugar, alcohol and Co-generation. Apart from Sugar business it also has Power transmission (formerly known as gears business) and water/wastewater treatment business. The Company currently operates 6 co-generation power plants located across five sugar units and two molasses-based distilleries in U.P. India, located at Muzaffarnagar and Sabitgarh. The Company holds 21.85% equity capital of Triveni Turbine Limited.

Stock Details

Market Cap. (Cr.) 5281.14
Face Value 1.00
Equity (Cr.) 24.18
52 Wk. high/low 235.00/62.45
BSE Code 532356
Book Value (Rs) 70.43
Industry Sugar
P/E 14.48


Share Holding Pattern %


FIIs 4.74
Institutions 5.12
Non Promoter Corp. 2.04
Public & Others




Total 100.00

Price Chart

Triveni -Engineering-price-chart

Key Investment Rationale:

  • The company plans to invest Rs 350 crore to double its alcohol manufacturing capacity over the next nine months, as it seeks to gain from the government’s push for ethanol blending in petrol.

  • Company’s new distillery with capacity of 160 KLPD and grain based distillery of 60 KLPD are expected to be commissioned in Q4FY22 with a total estimated capex of Rs 250 Crore. Other expansions of distillery capacity, that will increase the total capacity to 660 KLPD from current capacity of 320 KLPD, will be commissioned in Q3FY23.

  • Distillery segment revenue is increased at a CAGR of 34% from FY17-21 with its contribution in total revenue increased from 5.1% in FY17 to 10.7% in FY21 and further 21% in H1FY22. The company expects that revenue from its distillery segment will increase to about Rs 1,500 Cr. Annually once total capacity of distillery increased to 660 KLPD by Q3FY23

  • Ethanol blending with petrol has touched 8.1 per cent in the 2020-21 marketing year (December-November) and is expected to reach 10 per cent in the next year and 20 per cent blending target by 2025. Govt. hiked the price of ethanol extracted from sugarcane for blending in petrol by up to Rs 1.47 per litre for 2021-22 marketing year ( December- November) starting December which would help the company to expand its margins.

  • The company signed a 10-year business agreement with GEAE Technology USA to locally manufacture the LM2500 gas turbine base and enclosure. Over the next years, the growth in revenue of the company will be aided more by its engineering businesses


Triveni Engineering & Industries Ltd. Is one of the largest integrated Sugar manufacturers in India and also emerged as the market leader in high-speed industrial gears and gearboxes. The sugar industry witnessed significant reduction in sugar inventory in the last one year, which along with the increasing sugarcane diversion towards ethanol is leading to increase in sugar prices. Sugar companies like Triveni has been largely benefiting from relatively better sugarcane availability in 2020-21 sugar season, ramping up of ethanol capacities & higher domestic sugar prices. On performance front we expect company to report EPS of Rs.17.01 for FY23E, at CMP of Rs.218 PE works out to be 12.81x. Hence, investors can buy the stock at CMP of Rs.218 for target price of Rs.275. Time frame should be 9-12months.

Business Overview


Sugar: Triveni Engineering is the among the largest integrated sugar manufacturers in India and their association with Indian farmers is as old as the industry itself. It also Produce power from coproduct Bagasse – a residue of sugarcane crushing. Power generated by the company is used to meet captive needs, and surplus sold to Uttar Pradesh Power Corporation Limited.

Alcohol: Producers of ENA (which is used to produce Potable Alcohol) & Fuel-Grade Ethanol. It Has 2 state-of-the-art distilleries at Muzaffarnagar (MZN) & Sabitgarh (SBT) with 320 KLPD current capacity. The Company aims to double its Production capacity to 660 KLPD by Q3FY23. Currently the company is setting up two new distilleries of (i) 40 KLPD (grain based) at Muzaffarnagar, Uttar Pradesh ; and (ii) 160 KLPD (molasses/cane juice & syrup/grain based) at sugar unit situated at Milak Narayanpur, U.P raising total distillation capacity to 520 KLPD  which would get operational by Q4FY22.

Power Transmission – Triveni is the India’s largest manufacturer of industrial high-speed gears and gearboxes. Company’s Defence Business, a strategic business unit, is an OEM for many important defence products and solutions to Indian Navy & Indian Coast Guard. Triveni is the approved supplier of Propulsion Gearboxes, Gas Turbine Generators, Steam Turbines, Turbo auxiliaries and special application turbo & motor-driven pumps for the Indian Navy and Coast Guard.Water & Wastewater Treatment Solutions – Leading solutions provider for efficient water management for industrial/municipal/urban applications. 10,000 Million Litres Per Day (MLD) water treated

Source: Annual Report

Indian Sugar Industry and Outlook for Season 2021-2022:

Sugar production for the season 2020-21 was around 311.81 lakh tones with  domestic sales of around 265.55 lakh tonnes and exports of around 70.72 lakh tonnes during the season. Approximately 20 lakh tonnes of sugar were diverted for ethanol production in 2020-21.

In July 2021, Indian Sugar Mills Association (ISMA) had released its preliminary estimates of net sugar production at 310 lakh tonnes for 2021-22 SS (Sugar Season). This was estimated after considering a diversion of 34 lakh tonnes of sugar for production of Ethanol using B heavy molasses / juice / syrup.

The Cabinet Committee on Economic Affairs (CCEA), headed by Prime Minister Narendra Modi, raised the price of ethanol extracted from sugarcane juice to Rs. 63.45 per litre from the current Rs. 62.65 per litre for the supply year beginning December 2021.

Domestic sugar prices rose to around Rs 34,000-36,000 per tonne in August-September 2021 after three years following sharp increase in global prices as well as onset of the festive season. Sugar prices expected to remain firm above Rs. 36,000 per tonne for the rest of FY22.

The international raw sugar prices firmed up to USD 420-440 per tonne in August-September 2021 compared to USD 270-280 per tonne in August-September 2020 in the anticipation of decline in Brazilian sugar production and thus, balanced global supply position.

In light of surged global sugar prices, the export prospects look promising for the upcoming sugar season even if export policy isn’t announced. The government has set a target of 20% ethanol blending by 2025. Along with the ENA and rectified sprit, total distillery demand is likely to be 1350 crore litre by 2025-26. The government is also encouraging usage of flex fuel vehicles (can run on both petrol & ethanol).

On the back of favourable pricing environments domestically and globally as well as increased share of ethanol in revenue mix, the revenues of a sample of sugar companies are expected to grow by 5-7 per cent in FY22 on a year-on-year basis.

(Source: Economic Times. NDTV)

 Quarterly Performance:



Particulars  (in Rs. Cr.) Q2FY22 Q1FY22 Q2FY21 QoQ YoY H1FY22
Revenue from Operations 1068.46 1036.76 1168.39 3.1% -9% 2105.22
Other Income 8.64 3.63 7.91 138.0% 9% 12.27
Total Income 1115.06 1046.45 1176.3 6.6% -5% 2161.51
Raw Material Consumed 71.68 568.2 61.78 -87.4% 16% 639.88
Stock Adjustment 714.42 145.57 872.07 390.8% -18% 859.99
Purchase of Finished Goods 3.18 5.92 3.12 -46.3% 2% 9.1
Employee Expenses 65.76 67.75 60.58 -2.9% 9% 133.51
Other Expenses 106.15 99.73 93.91 6.4% 13% 205.88
EBITDA 107.27 149.59 76.93 -28.3% 39% 256.86
Finance Cost 12.13 15.64 14.09 -22.4% -14% 27.77
Depreciation 20.28 19.75 19.67 2.7% 3% 40.03
PBT 83.5 117.83 51.08 -29.1% 63% 201.33
Profit After Tax 92.47 92.3 31.18 0.2% 197% 184.77
EBITDA Margin (%) 10.0% 14.4% 6.6% -439 784 12.2%
PATM (%) 8.3% 8.8% 2.7% -53 617 8.5%

Segment Finance

Particulars (in Rs. Cr.) Revenue YoY As % of Revenue PBIT Margin
Segment H1FY22 H1FY21 % H1FY22 H1FY21 H1FY22 H1FY21
Sugar 1695.18 2067.27 -18% 69.5% 81.0% 7.3% 7.3%
Others 56.51 31.54 79% 2.3% 1.2% 2.2% -0.2%
Distillery 512 278.6 84% 21.0% 10.9% 16.2% 16.1%
Water 91.42 119.43 -23% 3.8% 4.7% 11.0% 7.7%
Power Trans. 82.63 55.83 48% 3.4% 2.2% 35.2% 27.6%
Total 2437.74 2552.67 -5% 100.0% 100.0%

Cash Flow Statement

Particulars (in Rs. Cr.) FY21 FY20 FY19
Cash and Cash Equivalents at Beginning of the year 32.04 14.62 3.67
Net Cash from Operating Activities 790.79 510.35 -168.7
Net Cash Used in Investing Activities -107.86 -107.24 -214.74
Net Cash Used in Financing Activities -703.69 -385.69 394.39
Net Inc/(Dec) in Cash and Cash Equivalent -20.76 17.42 10.95
Cash and Cash Equivalents at End of the year 11.28 32.04 14.62

Balance Sheet

Particulars (in Rs. Cr.) H1FY22 FY21 FY20
Shareholders Fund 1702.72 1555.67 1338.66
Share Capital 24.18 24.18 24.79
Reserves & Surplus 1678.54 1531.49 1313.87
Total Non Current Liabilities 513.69 515.19 600.92
 – Long Term Borrowings 300.74 308.91 443.6
 – Deferred Tax Liabilities(Net) 143.24 134.09 78.24
 – Other Long Term Liabilities 16.26 20.44 31.15
 – Long Term Provisions 53.45 51.75 47.93
Total Current Liabilities 666.43 1549.09 2106.43
 – Short Term Borrowings 272.35 561.58 943.44
 – Trade Payables 103.11 624.3 756.42
 – Other Current Liabilities 253.47 325.93 374.74
 – Short Term Provisions 37.5 37.28 31.83
TOTAL EQUITY & LIABILITIES 2882.84 3619.95 4046.01
Total Non Current Assets 1529.01 1407.31 1395.72
 – Fixed Assets(incl. Capital Work in Progress) 1138.34 1094.55 1112.69
 -Tangible Assets 1054.44 1071.08 1085.6
 -Intangible Assets 2.03 1.92 0.93
 -Capital Work in Progress 82.55 22.23 26.16
 – Goodwill on Consolidation 0.68 0.68 0
 – Non Current Investments 186.07 145.67 141.66
 – Deferred Tax Asset(Net) 0.29 0.27 0.18
 – Long Term Loans & Advances 160.8 133.81 90.26
 – Other Non Current Assets 42.83 32.33 50.93
Total Current Assets 1353.83 2212.64 2650.29
 – Inventories 862.5 1733.75 1912.13
 – Trade Receivables 174.4 208.39 267.96
 – Cash & Cash Equivalents 102.94 12.6 32.88
 – Short Term Loans & Advances 0.41 18.44 3.38
 – Other Current Assets 213.58 239.46 433.94
TOTAL ASSETS 2882.84 3619.95 4046.01
Debt Equity Ratio 0.34 0.56 1.04
Current Ratio 2.03 1.43 1.26
Debtors Days 14.51 16.27 22.05
Creditors  Days 11.17 61.47 78.71
RONW % 21.4 18.94 25.03
ROCE % 25.06 20.9 19.04

Financial Extracts:

  • Sugar business of the company in H1FY22 was impacted due to lower domestic sales quota and Exports.

  • EBITDA margin was improved YoY in Q2FY22 to 10% on better sugar realizations (34212/MT – Domestic Realization price in H1 FY 22)

  • Sugar inventory as on Sep 30, 2021 was 23.93 lakh quintals, which is valued at around Rs. 29.2/kg. Inventory at lower prices should help the company to improve realizations.

  • Lower tax and higher Profit from the associates helped the company in 195% YoY increase in Net Profit against the EBITDA growth of 39% YoY.

  • Distillery segment of the company is gaining traction with revenue contribution increased from 10.9% in H1FY21 to 21% in H1FY22.

  • Reported higher profitability in Power Transmission business in Q2FY22 due to the highest ever quarterly revenue of Rs 54.36 Crore in Q2FY22. Closing order booking for the segment stood at Rs 160 Crore in Q2FY22.

  • Turnover in the Water business was lower in H1FY22 as compared to corresponding period of last year, due to slow progress in certain projects and delays in lifting of equipment

  • In Water Segment, Company has participated in large number of tenders which are in various stages of finalization and is expected to close some of these in the coming quarters.

  • Return on Capital Employed improved from 20.9% in FY21 to 25.06% in H1 FY22

  • Debt to Equity Ratio improved from 0.56 in FY21 to 0.34 in H1FY22.


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