At a Glance
Sir Shadi Lal Enterprises Ltd (SSLE) is a legacy sugar and distillery business that’s been around since 1933 — which is exactly how old their financial model feels. After years of bleeding red, losing equity, and running on fumes, the company now finds itself under new ownership: Triveni Engineering. But can the open offer and planned restructuring sweeten this bitter sugar story?
1. Introduction with Hook
What happens when a 90-year-old sugar company forgets how to make profits, pays zero dividends, burns through equity, and then hands the keys over to a rival?
You get Sir Shadi Lal Enterprises Ltd — a company whose book value is literally negative ₹399 per share. That’s not a typo. That’s the financial version of a horror film.
2. WTF Do They Even Do? (Business Model)
- 🧂 Sugar Production: Your typical crushing, milling, boiling.
- 🥃 Distillery Division: Spirit, industrial alcohol, and now some ethanol.
- 🏭 Plant Locations: Based in Uttar Pradesh — a hotspot for sugar politics, subsidies, and cane price drama.
- 🧳 Legacy Company: Founded in 1933. Was once a serious name in North India. Now mostly a historical footnote.
3. Financials Overview – Profit, Margins, ROE, Growth
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | ₹552 Cr | ₹462 Cr | ₹268 Cr |
| Net Profit | ₹-30 Cr | ₹-9 Cr | ₹-45 Cr |
| OPM | -2% | 1% | -1% |
| ROCE | -5% | -1% | -2% |
| ROE | -20% | N/A | N/A |
📉 Sales have HALVED in just two years.
📉 Margins are like a sugar crash — brief highs followed by deep lows.
📉 ROE? Just imagine a flaming dumpster.
4. Valuation – Is It Cheap, Meh, or Crack?
- 🧮 Market Cap: ₹139 Cr
- 💀 Book Value: ₹-399
- 🤐 P/E: N/A
- 💰 Fair Value Range: ₹40–₹80 (assuming turnaround post-merger, 0.5x–1x future sales potential)
🚨 Only reason it’s trading at ₹265 is speculation around the open offer & Triveni Engineering’s interest. On fundamentals alone, it would be sub-₹50.
5. What’s Cooking – News, Triggers, Drama
- 🔁 Open Offer Drama: Triveni Engineering acquired 36.34% in June 2024.
- 📩 Open Offer to Public: 26% more shares targeted, ongoing.
- 🧠 Board Restructuring: CEO + CFO exits, new management in place.
- 🛠️ Amalgamation + Demerger Plan: Approved in Dec 2024.
- 🥃 Ethanol Play?: If Triveni turns it into an ethanol arm, could be a hidden value story.
6. Balance Sheet – How Much Debt, How Many Dreams?
| Metric | FY25 |
|---|---|
| Equity Capital | ₹5 Cr |
| Reserves | ₹-215 Cr |
| Debt | ₹331 Cr |
| Assets | ₹316 Cr |
- Net worth = deep negative
- Fixed Assets have crashed from ₹903 Cr in FY24 to ₹83 Cr in FY25 — likely impairments or sales.
This isn’t a balance sheet — it’s a financial obituary.
7. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Flow |
|---|---|---|---|---|
| FY24 | ₹48 Cr | ₹-2 Cr | ₹-44 Cr | ₹2 Cr |
| FY25 | ₹-253 Cr | ₹-14 Cr | ₹269 Cr | ₹1 Cr |
- FY25 cash flow from operations went negative ₹253 Cr.
- ₹269 Cr came in via financing — almost certainly loans or equity infusion.
This is not “free cash flow”. This is “free fall cash flow”.
8. Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROCE | -2% |
| ROE | -20% |
| Interest Coverage | <1x |
| Inventory Days | 304 |
| Debt/Equity | Infinite (no equity) |
🏚️ The company has been burning capital for over a decade.
💡 But thanks to low debt (for now) and new parent, hope exists.
9. P&L Breakdown – Show Me the Money
Revenue Trend:
- FY22: ₹470 Cr
- FY23: ₹552 Cr
- FY24: ₹462 Cr
- FY25: ₹268 Cr
FY25 Net Loss: ₹45 Cr
Sales collapsed, operating profit turned negative again. OPMs have never crossed 6% in the last decade.
The company was profitable only for a single year in FY17 (₹18 Cr profit). Everything else? Glorious losses.
10. Peer Comparison – Who Else in the Game?
| Company | CMP | ROCE | OPM | ROE |
|---|---|---|---|---|
| Balrampur Chini | ₹597 | 11% | 13% | 12% |
| Triveni Engg | ₹370 | 8.6% | 8.3% | 7.9% |
| Dalmia Sugar | ₹394 | 9.4% | 12.5% | 12.4% |
| Sir Shadi Lal | ₹265 | -1.7% | -1% | -19.8% ❌ |
Verdict: Sir Shadi Lal is like that cousin who flunked school while the others went to IIT.
11. Miscellaneous – Shareholding, Promoters
- 🧳 Promoter Exit: Promoters sold 36.34% stake in June 2024.
- 🏢 New Controller: Triveni Engineering (open offer + mgmt revamp)
- 👥 Public Holding: ~38%
- 🗳️ Open Offer Price: Unclear, but speculation kept stock above ₹200
Only reason this is on the radar? Triveni may revive it as a captive ethanol/sugar asset.
12. EduInvesting Verdict™
Sir Shadi Lal Enterprises is the financial equivalent of a haunted haveli. Ancient, spooky, maybe valuable if renovated — but also likely cursed.
- Negative net worth
- Repeated losses
- Margins in ICU
- But Triveni’s entry has added hope
🎯 Fair Value Range: ₹40–₹80
🎲 Current Price: ₹265 — purely speculative premium
🚨 Unless Triveni does a full business turnaround, this stock will likely sugar-crash.
✍️ Written by Prashant | 📅 July 9, 2025
Tags: Sir Shadi Lal Enterprises, Triveni Engineering, Sugar Stocks, Ethanol India, Open Offer, Distillery Turnaround, EduInvesting
