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Capital Raising

Investment in grain-based distillery-ethanol producing plant in India

Mandate ID: IN-11-SRV-9-2307-3
Transaction Type:
Capital Raising

Industry: Manufacturing


Sector: Energy


SIC Code: 20850100 DISTILLER'S DRIED GRAINS AND SOLUBLES, AND ALCOHOL


Country of Origin: India | India


Target Areas: Worldwide


Business Review

1) Our client is engaged in the production of ethanol from grain and molasses and sale thereof to oil manufacturing companies (OMCs) for directly blending with petrol. The company is also engaged in purchasing Special Denatured Spirits (SDS) both molasses based and grain based and processing the same to a more than 99.7% purity (ethanol) and selling the same to OMCs.

2) Fuel grade ethanol is made by dehydration of special denatured spirit. This spirit is made from molasses and damaged food grains. Our client’s plant in Maharashtra, India buys the denatured spirit from various distilleries which is 94%-95% purity and re-distils it in its plant. Grain based impure spirits are used by various industries like pharma, paints and adhesive, fumigation and sanitization, primers and paints, etc.

3) The orders from the oil companies are standing and on completion of each order, the quantity gets “topped up”. The prices are fixed by the government and through private oil companies tenders, the company executes the same based on indents of depots given to us. The price at which the company supplies the product is basic + transport (predetermined per destination) + taxes.

4) The company is currently in the process of setting up their own grain-based distillery to ensure continuous flow of raw materials to their re-distilling plant. With the setup of the 120 KLPD (kilo litres per day) grain based distillery in an 8 acre-land, the ethanol plant will be able to operate at more than 90% of its 150 KLPD capacity. This project is in its early stages of implementation.

5) Total project cost of 150 KLPD ethanol and 120 KLPD distillery: USD 17.09 Million

6) Total projected assets by FY 2029-30: USD 24.54 Million

7) Total projected liabilities by FY 2029-30: USD 0.33 Million

8) Investment required is around USD 14.3 Million. This can even be in the form of a debt / loan.

Products

Production of ethanol from grain and molasses

Services

Manufacture and sale of ethanol

Financial Information

Capital required: USD 14.3 Million


Highlights

Ethanol blending plays a crucial role in providing energy security to the country as well as addresses the trade imbalance (deficit) in a huge way. According to the Govenment of India Ethanol Blending Programme (EBP), India aims to achieve 20% ethanol blending in petrol by 2030.

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