1. At a Glance – The Sweetness Test
₹148 crore market cap. ₹31.1 stock price. Sales of ₹123 crore in Q3 FY26. Net loss of ₹17 crore. Book value? ₹-23.4. Yes, negative.
Welcome to SBEC Sugar Ltd, where sugar recovery is 10.75% but financial recovery is still under construction.
The company has delivered:
- TTM Sales: ₹599 crore
- TTM PAT: ₹-26 crore
- Debt: ₹301 crore
- ROCE: 12.4%
- Current Ratio: 0.11
- Interest Coverage: 0.41
In simple terms: the factory crushes cane, but interest is crushing profits.
The stock is down 34.4% in 1 year, down 21.7% in 6 months, and mildly sulking in the last 3 months. Yet, promoters still hold 65.13%.
Latest quarterly result (December 2025) shows:
- Sales: ₹123 crore
- PAT: ₹-17 crore
- EPS: ₹-3.63
The company has also executed a ₹141.77 crore One-Time Settlement (OTS) with Modi Industries. ₹34.5 crore received. ₹59.5 crore outstanding.
Question is simple: Is this a turnaround candidate or a sugar mill running on financial insulin?
Let’s investigate.
2. Introduction – Modi Group’s Bitter-Sweet Chapter
SBEC Sugar was incorporated in 1998. It is promoted by the Modi Group and SBEC Systems Ltd, UK.
Sounds classy, right? UK engineering pedigree and Indian sugar fields.
But here’s the twist.
The company has been reporting recurring losses and its net worth has eroded.
Sugar is a cyclical business. Good monsoon = happy mill. Bad monsoon = banker panic attack.
FY23 operational highlights:
- Cane crushed: 133.44 lakh quintal
- Recovery: 10.75% (down 0.44%)
- Sugar production: 14.38 lakh quintal (down 5.33%)
Climatic conditions and disease impacted output.
And then there’s the financial side.
Debt is ₹301 crore.
Net worth is negative.
Interest costs are rising.
And now they want to build a 100 KLPD ethanol plant with loans of:
- ₹97.88 crore (interest subvention approved)
- ₹130.50 crore application with UP Co-operative Bank
When your balance sheet is weak, expansion feels like ordering dessert after skipping dinner.
Bold or reckless? You decide.
3. Business Model – WTF Do They Even Do?
SBEC Sugar manufactures sugar. That’s it.
But let’s break it properly.
Core Activity:
- Crushing sugarcane
- Producing sugar
- Planning ethanol
The mill capacity was 8,000 TCD (tons crushed per day). Now upgraded to 9,000 TCD. Planning 10,000 TCD next phase.
Cane area: 26,500 hectares.
Expected yield: 2.65 lakh tons.
Drawl rate: 70%.
If all goes well, more cane = more crushing = more sugar.
But remember:
Sugar pricing is controlled.
Cane pricing is politically sensitive.
Margins depend on recovery rates.
And then comes ethanol.
Government ethanol blending policy makes ethanol a hot topic. So SBEC wants to set up a 100 KLPD ethanol plant.
Translation:
Move from low-margin sugar to better-margin ethanol.
But ethanol needs capex.
Capex needs debt.
Debt needs profits.
Profits are currently missing.
So the business model is simple:
Crush cane. Sell sugar. Borrow money. Hope ethanol saves the day.
Are we looking at strategic diversification… or financial overreach?
4. Financials Overview – The Numbers Don’t Lie (But They Do Cry)
- Jun 2025: -5.47
- Sep 2025: -6.00
- Dec 2025: -3.63
Average = (-5.47 – 6.00 – 3.63) / 3 = -5.03 approx
Annualised EPS = -5.03 × 4 = -20.12
So trailing earnings are deeply negative.
Quarterly Comparison (₹ Crore)
Source table
| Metric | Latest Qtr (Dec 25) | YoY Qtr (Dec 24) | Prev Qtr (Sep 25) | YoY % | QoQ % |
|---|
| Revenue | 123 | 143 | 147 | -14% | -16% |
| EBITDA | -1 | -7 | -13 | Improvement | Improvement |
| PAT | -17 | -22 | -29 | Improvement | Improvement |
| EPS (₹) | -3.63 | -4.68 | -6.00 | Improvement | Improvement |
Sales are falling.
Losses are narrowing.
This is like bleeding slower. Good sign… but still bleeding.
TTM Sales: ₹599 crore
TTM PAT: ₹-26 crore
With negative annualised EPS,
