UPPER GANGES KK Birla Group Company Sugar Stock

Upper Ganges, a KK Birla Group company, is the first sugar company having declared its results for the quarter ending March 09. The noteworthy feature about these results are increase in stock of Rs.83.32 crore for the quarter and Rs.25.46 crores for 9 months ending 31-03-09. This means, opening stock of inventory of Rs.215 crores, held by the company as at 01-07-08, largely being sugar, got increased to Rs.240 crores as at 31-03-09. Due to inventory being valued at cost or market price, whichever is lower, there is decrease in quantity of sugar stock held in this period , due to higher cost of production of sugar in this season.
During March 09 quarter, sugar got sold at an average of Rs.2,075 per quintal, while now it is ruling at Rs.2,400 per quintal. So, this increase of 15% would get reflected and realized in the coming quarters on sale of inventory held as at 31-03-09.
one can say that cost of production of sugar is fully met from realization of its by-products. Hence hereon, margin from sugar can be calculated by difference between sugar-cane price and sugar realization.
The company has stopped crushing and in subsequent two quarters, the company will have its income by selling its inventory. In view of sharp realization in sugar, it will have better margins that would get reflected in its financial results. thanks