In today’s target price analysis series, we’ll be discussing the stock of Balrampur Chini Limited. As you may know, “chini” is another word for “sugar”, and this company specializes in sugar manufacturing. So, without further delay, let’s begin the in-depth analysis of Balrampur Chini share price target for the upcoming years, including 2023, 2024, 2025, and all the way up to 2050.
Balrampur Chini’s revenue comes from three main sources: sugar, co-generation, and distillery. We’ll delve into these aspects later in this article, but first, let’s take a closer look at the target price, as that’s what you all are eagerly searching for on the internet.
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About Balrampur Chini Mills Ltd.
Balrampur Chini Mills Limited was established in 1975 and was among the pioneers in distillery and cogeneration operations. The company has 10 manufacturing units located mainly in Uttar Pradesh and currently has a sugar capacity of 76,500 TCD. Balrampur Chini Mills was one of the first in the industry to install incinerator boilers in the distillery, which allows for the operation of the distillery for 330 days, resulting in increased production capacity.
The company earns revenue from three primary sources – sugar manufacturing, cogeneration, and distillery. Sugar manufacturing is straightforward, while cogeneration involves generating electricity and process heat from waste materials during the industrial process. The power generated is used within the factory, with excess power sold to the grid, generating additional revenue for the sugar mill.
The distillery produces ethanol during the sugar manufacturing process, and Balrampur Chini’s revenue and profit from the distillery segment have been continuously increasing due to the biofuel policy of 2018. This policy aims for 20% ethanol blending in petrol by 2025, and India has significant potential for growth in the global ethanol market.
Ethanol is a game-changer for the sugar industry for several reasons, like:
- It helps sugar companies get rid of sugar surpluses, which was a significant problem previously.
- Ethanol production also supports farmers by increasing sugarcane demand.
- Additionally, ethanol reduces dependency on crude oil and promotes clean energy by reducing carbon emissions.
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Balrampur Chini Mills Share Fundamental Analysis
Data As of 2nd September 2023
Current Market Price | Rs. 396 |
Market Cap | Rs. 7,989 Crore |
P/E Ratio | 23.1 |
EPS | 17.09 |
52 Week High | Rs. 431 |
52 Week Low | Rs. 307 |
Book Value | Rs. 143 |
Dividend Yield | 0.63% |
ROCE | 10.4% |
ROE | 10% |
Promoters Holding | 42.89% |
FIIs Holding | 13.67% |
DIIs Holding | 21.32% |
Public Holding | 22.11% |
The company has shown an overall increasing trend in sales, with reported sales of Rs. 2460 crores in 2017 and Rs. 4846 crores in 2022. The compounded sales growth for 10 years is 8%, for 5 years is 7%, and for 3 years is 4%, but the TTM sales growth is -3%.
Balrampur Chini’s net profit has also been on an upward trend, with a reported net profit of Rs. 599 crores in 2022. The compounded profit growth for the company is 101% for 10 years, -5% for 5 years, -6% for 3 years, and -41% for TTM.
The company’s share capital has been consistently dropping due to regular buybacks, which is a positive sign. Additionally, the company’s borrowings have also decreased, with total borrowings of Rs. 1144 crores in 2013 and Rs. 512 crores in 2022, further indicating a positive trend for the share price.
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Balrampur Chini Share Price Target 2023 to 2050
Balrampur Chini is India’s biggest integrated sugar company with a market capitalization of Rs. 8,446 Cr. Its allied businesses include distillery operations and cogeneration of power. The company has expanded its capacity through well-planned capacity expansion projects and acquiring existing companies in recent years.
Over the past 10 years, the stock price CAGR has been 24%, over 5 years it’s been 45%, over 3 years it’s been 62%, and over the last year, it’s been -6%. Based on our analysis of Balrampur Chini’s financial performance and industry outlook, we anticipate significant appreciation in the company’s share price from 2023 to 2050.
We expect the stock to continue to appreciate over the long term, driven by the company’s strong fundamentals and growth prospects. Let’s take a look at the target prices for Balrampur Chini shares.
![Balrampur Chini Share Price Target](https://sharekingz.com/wp-content/uploads/2023/05/balrampur-chini-share-price-target-1024x1024.webp)
Year | Target Price |
2023 | Rs. 502 |
2024 | Rs. 627 |
2025 | Rs. 815 |
2026 | Rs. 1,019 |
2027 | Rs. 1,325 |
2028 | Rs. 1,589 |
2029 | Rs. 1,748 |
2030 | Rs. 2,098 |
2031 | Rs. 2,518 |
2032 | Rs. 3,147 |
2033 | Rs. 4,091 |
2034 | Rs. 4,705 |
2035 | Rs. 5,646 |
2036 | Rs. 6,775 |
2037 | Rs. 8,130 |
2038 | Rs. 9,756 |
2039 | Rs. 11,707 |
2040 | Rs. 14,049 |
2041 | Rs. 16,859 |
2042 | Rs. 19,893 |
2043 | Rs. 23,474 |
2044 | Rs. 27,699 |
2045 | Rs. 32,685 |
2046 | Rs. 38,568 |
2047 | Rs. 45,511 |
2048 | Rs. 53,703 |
2049 | Rs. 63,369 |
2050 | Rs. 74,775 |
Before proceeding to the next section of this article, we want to clarify that the target price mentioned earlier does not include any potential future price adjustments, such as bonuses, share splits, etc. Additionally, the target price is for educational purposes only and should not be considered a recommendation. It is also important to note that there is no guarantee that the stock will reach the specified target price.
Factors Affecting the Balrampur Chini Stock Target Price
Balrampur Chini Mills is currently focused on transitioning from a sugar company to an energy company. In pursuit of this objective, they have decided to increase ethanol production by sacrificing 20% of their sugar production. This move is expected to benefit the company and signify their growing interest in ethanol production.
However, there are some risks that not only affect Balrampur Chini Mills but also the entire sugar industry. One significant risk is posed by government policies, which have the potential to adversely impact the sugar industry’s performance. If any negative changes are made in the future, it could result in a significant decline in stock prices for companies in this industry.
Moreover, the sugar industry is subject to extensive regulation, including production quotas, sales quotas, and pricing, all of which are determined by regulatory bodies. These regulations can have a detrimental effect on companies in the industry. Additionally, as sugar is an agricultural commodity, production is heavily dependent on weather conditions, which is another risk factor to consider.
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FAQs Related to Balrampur Chini Share Target Price
Is Balrampur Chini a good stock?
Certainly, upon examining the basic principles of the stock, it seems to be a promising investment with a substantial potential for growth.
Is Balrampur Chini debt free?
Balrampur Chini is not a debt-free company, but it has been consistently reducing its debt. As of March 2023, the company has a debt of Rs. 481 crore on its balance sheet, with a debt-to-equity ratio of 0.44.
To conclude, Balrampur Chini Mills Limited is a prominent Indian sugar and ethanol producer with a promising future for growth. The company’s diversified business approach, strategic investments, and solid financial fundamentals create an appealing opportunity for investment.
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