From Anil Goel webinar , 70% of Ethanol plant capex cost will go towards boiler & only 30% to Distillery.
Does this mean Praj Industries won’t get a lion’s share in Ethanol play ?
What’s the revenue potential for Praj when reach we 1k cr litre ethanol capacity ?
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As per Mr.Shishir Joshhipura,MD- Rs.14,000 Cr of opportunity size would open up for them and they expect to capture 2/3rd of it.
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He corrected that figure later, for production from b-molasses and direct juice that cost will be atleast 50:50,
Insider disposal on regular basis is quite perplexing…
|MR. NITIN SHETE|Designated Person|70840 (0.04)|Equity Shares|70840|23216183.00|Disposal|0 (0.00)|24/05/2021
| 24/05/2021 | Market Sale | 06/06/2021 | |||
|---|---|---|---|---|---|
| MR. GHANASHYAM DESHPANDE | Designated Person | 26000 (0.01) | Equity Shares | 14000 | 4748400.00 |
| 01/06/2021 | Market Sale | 06/06/2021 | |||
| MR.GHANASHYAM DESHPANDE | Designated Person | 12000 (0.01) | Equity Shares | 5000 | 1789150.00 |
| 04/06/2021 | Market Sale | 06/06/2021 | |||
| Mr. Ghanashyam Deshpande | Designated Person | 30000 (0.02) | Equity Shares | 4000 | 1358075.00 |
| 21/05/2021 | Market Sale | 26/05/2021 | |||
| Mr. Abhijit Dani | Designated Person | 5044 (0.00) | Equity Shares | 4000 | 1235770.00 |
| 17/05/2021 | Market Sale | 20/05/2021 | |||
| Mr. Vikram Pandit | Designated Person | 30900 (0.02) | Equity Shares | 30000 | 10461096.00 |
| 18/05/2021 | Market Sale | 20/05/2021 | |||
| Mr. Sachin Raole | Director | 72500 (0.04) | Equity Shares | 10000 | 3073373.00 |
| 14/05/2021 | Market Sale | 17/05/2021 | |||
| Mr. Sachin Raole | Director | 92500 (0.05) | Equity Shares | 20000 | 6810264.00 |
| 11/05/2021 | Market Sale | 17/05/2021 | |||
| Mr. Sivaramakrishnan S. Iyer | Director | 180000 (0.10) | Equity Shares | 120000 | 40946465.00 |
| 11/05/2021 | Market Sale | 13/05/2021 | |||
| Mr. Berjis Desai | Director | 900027 (0.49) | Equity Shares | 300000 | 91519988.00 |
| 10/05/2021 | Market Sale | 13/05/2021 | |||
| BERJIS DESAI | Director | 953027 (0.53) | Equity Shares | 53000 | 10494000.00 |
| 31/03/2021 | Market Sale | 01/04/2021 | |||
| Mr. Ghanashyam Deshpande | Designated Person | 38564 (0.15) | Equity Shares | 6564 | 1182772.00 |
| 12/03/2021 | Market Sale | 15/03/2021 | |||
| Mr. Berjis Desai | Director | 1060343 (0.55) | Equity Shares | 107316 | 20271992.00 |
| 12/03/2021 | Market Sale | 15/03/2021 | |||
| Mr. Berjis Desai | Director | 1181450 (0.65) | Equity Shares | 90664 | 17217094.00 |
| 09/03/2021 | Market Sale | 11/03/2021 | |||
| Mr. Berjis Desai | Director | 1090786 (0.59) | Equity Shares | 30443 | 5750683.00 |
| 10/03/2021 | Market Sale | 11/03/2021 | |||
| Dr. Pramod Kumbhar | Designated Person | 132398 (0.07) | Equity Shares | 10000 | 1622065.00 |
| 26/02/2021 | Market Sale | 02/03/2021 | |||
| Dr. Pramod Kumbhar | Designated Person | 122398 (0.07) | Equity Shares | 10000 | 1647250.00 |
| 01/03/2021 | Market Sale | 02/03/2021 | |||
| S.SURESH KUMAR | Designated Person | 25700 (0.01) | Equity Shares | 25700 | 4290615.00 |
| 26/02/2021 | Market Sale | 01/03/2021 | |||
| S.SURESH KUMAR | Designated Person | 35700 (0.02) | Equity Shares | 10000 | 1450600.00 |
| 25/02/2021 | Market Sale | 01/03/2021 | |||
| BERJIS DESAI | Director | 1481450 (0.81) | Equity Shares | 300000 | 49401407.00 |
| 01/03/2021 | Market Sale | 01/03/2021 | |||
| ANANT PATIL | Designated Person | 107970 (0.06) | Equity Shares | 29330 | 4771460.00 |
| 26/02/2021 | Market Sale | 01/03/2021 | |||
| GHANASHYAM DESHPANDE | Designated Person | 45000 (0.02) | Equity Shares | 10000 | 1465700.00 |
| 26/02/2021 | Market Sale | 01/03/2021 | |||
| Mr. S.Suresh Kumar | Designated Person | 45700 (0.02) | Equity Shares | 10000 | 1415500.00 |
| 18/02/2021 | Market Sale |
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Thanks for sharing.
Can these be ESOPs by employees
Vikas
Insider selling is not by Promoters and the seven persons (Designated persons / Directors ) who sold their holding in the past three four months is around an aggregate of 3.19% … IMHO this may not have any bearing on the performance of the company as they are non promoters , may be selling for their personal commitment… As per Mr.Shishir Joshhipura,MD, Company is having a long runway by way of strong pipeline of Ethanol blending in Petrol , Diesel, Airline fuel and also CBG and Hi purity System.
True they are not promoters but are insiders and they have much more information then common retail investor.
Disclosure : Invested since levels of 75 and and also booked partial profit at current levels.
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Action on the ground
Quoting below 2 para from the ET article:
Highlighting the need for a policy for import substitution, the minister said India imports Rs 8 lakh crores of crude oil, and this will rise two-folds in the next 4-5 years which would have a huge impact on the economy.
Gadkari said India’s minimum support price (MSP) for some crops are higher than international prices that is why the government allowing ethanol production from sugarcane, foodgrains and corn. “We will make ethanol economy of Rs 2 lakh crore in the next five years,” he said.
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Is this 8 lakh crore per year (2020)? Then now EBP aims 1000 cr litres of ethanol?? So huge potential am i right ??
While there are huge opportunities for Praj in near/midterm future, I wonder how ready they are to scale up. Most importantly, the human resources that are required to run the new projects cannot be built, hired and put to use in short span of time. It takes time and toll on existing workforce, leading to qualitative issues.
I am not well versed with internal working of the industry, but this remains a concern in back of my head.
Any thoughts?
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Well in an international survey done by the bitoech industry…it was voted as the no. 1 place to work…with lowest attrituon rate…
they have invested heavily
in R&D and human reaources…and i think these “investments” which look “wasteful”
in the start…come
in handy later to scale up the business…
i am sure investors of Infosys also back in the day would have asked themselves the same question.
Today,everybody wants to work their just for the quality of their campus and work culture.
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any idea what is the current order book for Praj , any info whether they are getting new contracts for Ethanol plant set up , or this ethanol story is just another story .
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Ethanol - Demand, Market Size, Opportunities & New Government Policies
(For beginners or anyone who wants to understand in detail about Ethanol)
Introduction
Ethanol, also called ethyl alcohol, drinking alcohol, or simply alcohol is simple alcohol which is often abbreviated as EtOH. Ethanol production in India is mainly dominated by sugary feedstock, C-heavy molasses available from sugar mills. Ethanol produced by fermentation of renewable food crops such as sugarcane, maize, wheat, sorghum, beet, and other starches is called bioethanol, and it is the eco-friendly alternative biofuel. The product is primarily used as a solvent in various industries such as:
In addition, ethanol is gaining popularity as an efficient alternative fuel. It has significant penetration in the major end-use industries such as automotive, foods and beverages, chemicals, personal care and cosmetics, and pharmaceuticals. According to the reports, the global ethanol market is projected to grow at a robust CAGR of 4.5% to reach USD 117 Billion by the end of 2027. The primary factors favoring the growth of the global ethanol market are the increasing demand for the product in the rapidly growing end-use industries such as automotive, food and beverages, and chemicals.
In Chemistry terms, ethanol or ethyl alcohol is the 2nd member in the family of molecules containing OH (hydroxyl) group attached to a carbon atom, with the chemical formula C2H5OH. This molecule has three widely known applications –
As fuel ethanol where it is mixed with gasoline as an oxygenate to boost octane number and in higher proportions, to replace gasoline. As beverage alcohol where it is the principal component of alcoholic beverages like whiskey, rum, vodka. In industrial applications like paints, varnishes, perfumes, pharmaceuticals, industrial solvents,s, etc.
Sugar Process Flow chart
In a fermentation process sugar (glucose, fructose, or other monosaccharides) is converted to ethanol by microbes (mostly varieties of the yeast Saccharomyces cerevisiae), which are inoculated to the feedstock. The monosaccharides originate either directly from disaccharides, which are broken up via invertase enzymes, or from starch which is hydrolyzed with amylase enzymes. In addition to ethanol, water and carbon dioxide are produced also.
The feedstock for ethanol production can be any material containing appreciable amounts of sugar or substances that can be converted to sugar. Conventional production uses sugar (from sugar cane and sugar beet), starch (from corn, wheat, or potatoes), or other polysaccharides. The production process of second-generation ethanol, also called cellulosic alcohol, uses cellulosic feedstock (e.g. from agricultural residues) which requires further pretreatment.
Huge runaway for Growth
The total annual installed capacity of Ethanol in India is 460 Cr. L In the next 5 yrs, OMCs Ethanol requirement will be ~2000-2400 Cr. Lts as per 10% Ethanol blending India has a target of achieving 10% Ethanol blending by 2022 & 20% Ethanol blending by 2030.
India has preponed the target of achieving 20% ethanol-blending with petrol by five years to 2025 as it looks to cut dependence on costly oil imports. In 2014, less than 1% ethanol was being blended with petrol against the target of 5%. In the last sugar year, this ratio has reached 8.5% and next year it is 10%, Last year the government had set a target of reaching 10% ethanol-blending by 2022 (10% of ethanol mixed with 90% of petrol) - and 20% by 2030. "But now the 20% target has been advanced to 2024-25.
When the nation achieves that ratio of blending, India will be second only to Brazil in blending ethanol in petrol. But in absolute terms, India will be higher than Brazil. India is 83% dependent on imports for meeting its oil needs. Doping petrol with ethanol will cut down the import requirement. Also, ethanol being less polluting fuel, it will cut down carbon emissions.
Source: ISMA
Government Recent Policy to augment the growth
The government has announced the 5 year tender for procurement. There’s a big push on the ethanol side. High interest for grain-based ethanol plants following the Government announcements regarding the use of surplus grains. The current ethanol blending rate in India has reached a level of 5.1% amounting to 200 crore liters in the current year. With the Government’s plan to reach 10% by 2022 and 20% by 2030, there is a significant capacity that needs to be built to cater to the additional blending requirement by 2022. With a view to achieving blending targets, Government is encouraging sugar mills and molasses-based standalone distilleries to enhance their ethanol distillation capacity. Based on the ethanol supply offers, Public Sector Oil Marketing Companies (OMCs) have allocated 325.5 crore liters for Ethanol Supply Year (ESY) (period from Dec. to Nov.) 2020-21 to be blended with petrol under the EBP Programme.
Source:GIA Research & ISMA
In fact, to meet the target of 20% ethanol blending, the industry will fall short of sugarcane and will have to depend on grains too. Distillery margins have been strong, so despite just 15% revenue contribution, the profit contribution is more than 50%. Most sugar companies are already working on expanding ethanol capacity. This will give them the flexibility to shift production between sugar and ethanol to maximize profitability.
Thus the ethanol distillation capacity in the country would increase from 426 crore liters per annum to about 590 crore liters per annum by 2022. To encourage sugar mills to divert excess sugarcane to produce ethanol for blending with petrol, the Government has allowed the production of ethanol from B-heavy molasses, sugarcane juice, sugar syrup, and sugar and has also fixed the remunerative ex-mill price of ethanol derived from these feed-stocks. The state-wise targets for ethanol manufacture have also been fixed.
Ethanol Process
Source: Novozymes
In order to enhance the ethanol production capacity in the country, DFPD has informed that Government has notified a the modified scheme on January 14,2021 for extending financial assistance in the form of interest subvention on loans advanced by Banks/NCDC/IREDA/NBFCs and any other financial institutions to project proponents for different activities viz. setting up of new distilleries, expansion of existing capacity, installation of Zero Liquid Discharge (ZLD) System and Molecular Sieve Dehydration (MSDH) Column, etc. for production of first-generation (1G) ethanol from feedstock such as cereals (rice, wheat, barley, corn, sorghum), sugarcane and sugar beet, etc. including granaries and surplus rice with Food Corporation of India (FCI).
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