E.I.D. – Parry (India) Limited approved the immediate closure of the refinery unit operated by its wholly-owned subsidiary, Parry Sugars Refinery India Private Limited (PSRIPL), effective March 31, 2026. The closure is due to sustained losses driven by structural market changes, high finance costs, and external challenges. To manage liabilities, the parent company plans to inject up to ₹610 crores via investment and extend an ₹130 crore inter-corporate loan.
Cessation of PSRIPL Refinery Operations
The Board of Directors of E.I.D. – Parry (India) Limited approved the closure of the sugar refinery unit managed by its wholly owned subsidiary, M/s. Parry Sugars Refinery India Private Limited (PSRIPL), effective from the close of working hours on March 31, 2026.
Reasons for Closure
The refinery, established in 2006 in Kakinada, Andhra Pradesh, was initially designed as an export-oriented unit based on importing raw sugar. However, the original business model was eroded by several factors:
- Rising Costs: Non-availability of natural gas forced investment in coal boilers, increasing operating costs.
- Revenue Decline: Sharp drops in white sugar premiums and lower-than-projected power export revenue.
- Operational Issues: Shutdowns from factory accidents, demurrage charges, inventory write-offs, and high finance costs.
- Financial Status: Accumulated losses reached approximately Rs. 1,406 Crores as of March 31, 2025. The continuous losses and external borrowings rendered the operation structurally unviable.
Financial Impact and Support Strategy
As of March 31, 2026, PSRIPL’s total estimated liabilities amounted to Rs. 998 crores, including Rs. 877 crores in bank borrowings supported by the Company.
The anticipated realization of assets is expected to settle Rs. 137 crores of these bank borrowings, leaving a remaining requirement of Rs. 740 crores. To settle remaining liabilities and support the subsidiary:
- Equity Investment: The Company approved an investment of up to Rs. 610 crores in PSRIPL’s shares on a rights basis, expected to be completed by May 31, 2026. The funds will be used to meet various liabilities.
- Inter-corporate Loan: An inter-corporate loan of up to Rs. 130 crores was approved for PSRIPL. This loan agreement is yet to be executed and will be unsecured.
Following these measures, the Company estimates needing to create a provision of approximately Rs. 655 crores across FY 2025-26 and FY 2026-27 for the fresh equity/loan infusion. Additionally, the Company will impair the current carrying value of its existing investment in PSRIPL, amounting to Rs. 46 crores.
Historical Performance Context
The refinery’s revenue from operations in FY 2024-25 was Rs. 4,262.45 Crores, contributing 13.48% to the Company’s turnover, while its net worth was negative at (Rs. 672.17 Crores).
The turnover history for PSRIPL over the last three financial years (in Rs. In Lakhs) shows:
- March ’23: 2,87,020
- March ’24: 4,40,082
- March ’25: 4,26,245
The Company confirmed that after the investment, PSRIPL will continue to remain a wholly owned subsidiary.
Source: BSE
