Zuari Industries Ltd Q2FY26 – When Sugar, Real Estate & Bioethanol Mix into a Billion-Rupee Cocktail of Confusion

1. At a Glance

Zuari Industries Ltd (ZIL), the 58-year-old chameleon of the Adventz Group, just pulled off a quarterly performance that could make even an auditor rub his temples and ask—“Wait, how did PAT go up 4,000%?”

As of 24 November 2025, the stock trades at ₹314 with a market cap of ₹931 crore, down about 2.7% in three months but still sitting on investment assets worth ₹4,700 crore. The irony? The market values the company at justone-fifth of its book value (P/B 0.20)— a literal case ofDilli me sona, market me chhutta.

With aQ2FY26 PAT of ₹164 croreversus ₹4 crore YoY, Zuari’s “sweet surprise” came from a strong ethanol play and a sprinkling of “other income magic.” The sugar, power, and ethanol division now contributes 91% of total revenue, while real estate and management services are just seasoning on the corporate thali.

And with thedebt pile at ₹2,347 crore, an interest coverage ratio of 1.55, and ROE in the red at -1.69%, this is a company juggling cane, condos, and cash flows like a circus performer on a sugar rush.

2. Introduction

Once upon a time in Goa, a fertilizer tycoon decided to diversify—from chemicals to condos, from sugar mills to ethanol stills, and from investment holdings to furniture showrooms. Thus was bornZuari Industries Ltd, the corporate equivalent of a multiplex buffet.

The story of ZIL is a perfect MBA case study titled“How to Do Everything at Once and Still Get a PAT Spike.”

It’s not just a company; it’s an empire of verticals. From producing sugar and green power to selling furniture underStyle Spa, and from constructing plush apartments in Goa to planning biofuel plants in UP—Zuari’s business model reads like a fantasy of diversification.

In FY24, the company crushed over 141 lakh quintals of cane, produced 239.56 lakh litres of ethanol, and exported 82.95 million units of power to the UP grid. But the real kicker? It sold 102 acres of land for ₹175 crore—because nothing clears cane dues like selling land in Goa.

Yet, despite its asset-heavy balance sheet and ₹4,700 crore investment portfolio, the stock trades as if it’s an abandoned sugarcane field. Why? Because markets have trust issues with companies that are part investment house, part sugar mill, and part real estate dealer.

3. Business Model – WTF Do They Even Do?

Zuari Industries is technically an “investment holding company,” but operationally, it’s more like a desi conglomerate that didn’t get the memo on focus.

Here’s their buffet of businesses:

• Sugar, Power, and Ethanol (SPE Division):The backbone and the sweet tooth of the company. With a crushing capacity of 10,000 TCD and a 125 KLPD distillery, this division generates not just sugar, but also ethanol and 22 MW of green power. It’s the dependable cousin who pays the bills.
• Real Estate Division:Handles massive land banks in Goa and Mysuru. Projects likeZuari Garden CityandZuari Rainforestsound fancy, but they also act as the company’s emergency ATM whenever debt needs trimming.
• Investments & Management Services:ZIL owns big chunks of Chambal Fertilisers, Texmaco Rail, and Mangalore Chemicals. These holdings are worth ₹4,700 crore, nearly 5x its market cap. But alas, the market doesn’t believe “book value” when it’s trapped in group company shares.
• Engineering & Furniture Manufacturing:IncludesSimon India(engineering) andForte Furniture Products, now a wholly owned subsidiary. Yes, this sugar baron also makes sofas. Why not?

If Zuari were a person, it’d be that one uncle who runs a sugar factory, builds villas, invests in startups, and sells teakwood furniture on weekends.

4. Financials Overview

Commentary:That PAT growth looks juiced up like ethanol itself. The secret ingredient? Other income worth ₹225 crore this quarter. Without it, Zuari’s core operations are still recovering from sugar-season mood swings. But hey, when your EPS jumps from ₹1 to ₹55, no one asks too many questions.

5. Valuation Discussion – Fair Value Range Only

Let’s