Sugar mills face 140-160 bps margin hit as ethanol curbs, higher cane costs bite

CNBC TV18 reported that sugar mills face a 140–160 basis points hit to operating margins this fiscal, as curbs on ethanol and higher cane costs bite. The outlet cited Crisil Ratings for the estimate. Basis points are a unit for small changes: 100 basis points make 1 percentage point, so 140–160 bps is a fall of 1.4 to 1.6 percentage points in operating margin. Operating margin is the share of revenue left after running costs, before interest and tax. Ethanol is alcohol made from sugarcane by-products such as molasses; mills sell it to oil marketing companies and it has been a cushion when sugar prices are weak. The report says that cushion is shrinking just as the cost of cane rises. It does not give a rupee figure for the margin or name the mills affected.

AI summary of what CNBC TV18 reported. AI can make mistakes. Read the full story on CNBC TV18