Balrampur Chini's ₹2,850 crore plastic gamble

With India’s sugar sector increasingly constrained by government price controls and climate volatility, Balrampur Chini Mills is making a ₹2,850-crore wager on a new growth engine: bioplastics.

- Nehal Chaliawala

The country’s second-largest sugar producer is setting up its first plant to manufacture polylactic acid, or PLA, a biodegradable plastic derived from sugar. The facility, expected to be operational by early 2027, will be built next to its existing mill in Kumbhi, Uttar Pradesh, and consume roughly 10% of the company’s sugar output, according to Stefan Barot, president of Balrampur's chemicals division.

The plant will have a production capacity of 80,000 tonnes per annum, Barot said in an interview in Mumbai.

Balrampur is targeting ₹2,000 crore in annual revenue from the new unit, with Ebitda (earnings before interest, taxes, depreciation, and amortization) mar-

gins of 35% at full capacity.

Analysts at Elara Capital expect a more gradual ramp-up: 60% capacity utilization by the second half of fiscal 2027, rising to 75% by FY28. Their models forecast ₹180 crore in Ebitda during second half of FY27 and ₹520 crore for the full year FY28.