Simbhaoli Sugars: Cane allocation issues impact 2 units, 1 unit starts crushing
Simbhaoli Sugars faces adverse impact due to meagre cane allocation for its Simbhaoli and Brijnathpur units, with no allocation for Chilwaria. Appeals against these decisions were dismissed. Unit Brijnathpur commenced crushing on November 14, 2026, while Simbhaoli and Chilwaria have not yet started operations.
The allocation of a meagre quantum of sugarcane and diversion of purchase centers directly impacts the company's core business of sugar production, affecting capacity utilization, revenue, and profitability. The inability to commence operations at two out of three units is a critical issue.
The company is facing significant adverse impacts on its operations and profitability due to unfavorable cane allocation decisions, which have been upheld by the appellate authority. This situation has also led to worker strikes at one unit.
Simbhaoli Sugars Limited has announced significant challenges for the Sugar Season 2026-27 due to decisions by the Cane Commissioner, Uttar Pradesh. The company received a "meagre quantum" of sugarcane for its Simbhaoli and Brijnathpur units, with no allocation for the Chilwaria unit. Furthermore, many cane purchase centers were diverted to other mills.
These decisions have led to a substantial adverse impact on the company's sugar production and overall operations. The company challenged these decisions in the Hon'ble Allahabad High Court, which directed them to appeal to the competent authority. Appeals were filed on October 31, 2026, but were dismissed by the appellate authority on November 12, 2026. The company is now planning to challenge this decision in a higher judicial forum.
The rejection of the appeal is expected to significantly impact cane availability, crushing volume, capacity utilization, and sugar production, consequently affecting revenue and profitability. The financial impact is currently not reliably quantifiable.
Regarding the commencement of crushing operations for the 2026-27 season: * Unit Simbhaoli: Operations have not yet started due to insufficient cane allocation. Workers are on strike demanding adequate allocation. * Unit Brijnathpur: Crushing operations commenced on November 14, 2026. * Unit Chilwaria: Operations have not started due to non-allocation of sugarcane.
The company is closely monitoring the situation and will communicate further material developments.
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Simbhaoli Sugars Limited filed this with the NSE as a statutory disclosure, categorised under other company updates. It is a primary document, not a recommendation, and the desk marks it high impact, which is the band that most often changes something.
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