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A

Presentation
on
“ Indian Sugar Industry”

Presented by
DUSHYANT PATEL [22]
FALGUN PATEL [23]
JAYESH PATEL [25]
INRODUCTION

 Sugar industry constitutes one of the most important agro-


based industries in India. it started growing in an organized
way during the 1930 after introduction of the sugar industry
protection act in 1932.
 India has been known as the original home of sugar and
sugarcane. India is the second largest producer of sugarcane
next to Brazil out of 10 largest producer of sugar in the
world.
 sugar industry is a major focus point for socio-economical
development in the rural area
Profile of Indian Sugar Industry
There are 608 registered sugar factories in the country.

Sector Number
Co-operative 317
Private 229
Public 62
Total 608

 45 million-7.5% of rural population engaged as sugar cane


farmers, agricultural laborers and dependents.
 Employs 0.5 million skilled & semi-skilled workers
 Area under sugar cane : 4.5 million hectares cultivation
 Average capacity of mills: 3200 tons cane per day
 Production of sugar : 20 million tons pa(organized sector)
3
Major strategies and their impact on
Indian sugar industry
 Sugarcane pricing policy.
 Government control on sugar.
 Government Policies.
 Government Relief to Sugar Industry and Sugarcane
Farmers.
 Central Government announces support measures for
sugar mills.

4
Profitability and growth of Indian
sugar industry

Sugar Area & Production

Year Area (Million Production


hectares) (Million tons)
2001-2002 4.41 297.21
2002-2003 4.36 281.57
2003-2004 3.99 236.18
2004-2005 3.75 232.00
2005-2006 4.14 267.00
2006-2007 4.25 280.00
2007-2008 4.50 290.00
State wise situation in major sugar
producing states in India
States 2004-2005 2005-2006 2006-2007

Uttar Pradesh 5.382 6.3 9.65

Maharashtra 2.205 5.197 9.3

Karnataka 1.1 1.9` 2.4

Tamil Nadu 1.1 1.85 2.6

Andhra Pradesh 0.982 1.2 1.4

Gujarat 0.797 1.168 1.4

Punjab 0.315 0.338 0.5

Madhya Pradesh 0 0.112 0.15


States wise Per capita
consumption of sugar

State 06-07
Uttar Pradesh 35.2
Maharashtra 40.9
Karnataka 23.3
Tamil Nadu 29.1
Gujarat 40.9
Haryana 68.5
Punjab 71.5

The consumption of white sugar in India is generally urban based,


in rural areas the alternate sweeteners Gur and khandsari are
consumed predominately. The per capita sugar consumption is
high in the states of Punjab followed by Haryana and Maharashtra.
This is due to higher GDP and higher income level of that states.
Global Situation
 Sugar Produced in 122 Countries,
 Out of 122 Countries 67 produce sugar from cane and 55
from beet.
 78 per cent of the sugar produced in the world is created
from sugarcane, with beet sugar accounting for the rest.
 Sugar is a widely traded commodity.
World Sugar Production
Mt
Country/Region 2007-08 2006-07 2005-06 2004-05 2003-04
Brazil 34.23 32.64 32.64 27.73 26.14
India 28.5 30.77 20.94 13.8 14.74
EU 17.45 17.38 21.03 21.95 20.21
China 13.59 13.04 9.58 9.86 10.9
USA 7.66 7.66 6.71 7.15 7.85
Thailand 7.89 7.03 5.08 5.43 7.28
Mexico 5.58 5.54 5.5 6 5.36
Sub-total Top 7 114.9 114.06 101.48 91.92 92.48
% of Total World 68.00% 68.30% 67.10% 65.10% 64.30%
Others 53.98 52.9 49.79 49.18 51.28
World Total 168.87 166.95 151.27 141.09 143.75
Non-financial Analysis of Indian
sugar Industry

 SWOT Analysis
 Porters five forces analysis
SWOT Analysis

 Strength

 Indian Sugar Industry provide an essential


commodity for Trading & Export.
 Indian Sugar Industry helps in socio-economic
development in rural India.
 Diversified crops and cropping systems
 Irrigation Potentiality
 Strong government Support.
 Weaknesses

 Old technology using


 Low installed production capacity
 Lack of professionalism
 Unreliable weather
 Lack of R&D Support and inadequate trained
human resource
 Physical infrastructure
 Opportunities

 Technology up gradation, new advanced


technology available for the byproduct
utilization.
 New variety
 Threats

 Sugar sector is vulnerable to political interest.


 Ground water availability
 Farmers are diverted in crop which required less
irrigation
Porter’s five forces analysis

 Threat of Substitutes
 Low
 Share of Treacle and khandsari declining

 Barriers to Entry
 Medium
 The Govt. used to give incentives to set up new
plants by granting higher free sales quota for the
first five to eight years of operations that had led to
mushrooming of small units
 Bargaining Power of Buyers
 Limited
 Govt. influences distribution, purchase price of levy
sugar and the free sale quota releases for sugar

 Bargaining Power of Suppliers


 High
 As the Govt. allocates the area from where the
sugarcane can be procured and announces the
purchase price (SMP/SAP), it protects the interest of
the sugar cane farmers

 Inter Firm Rivalry


 Intense
Conclusion
 In sugar Industry Govt has perform a more part because Govt
control the Industry.
 But they are not proper focus on their management so because
of this lots of mills are not working,
 Govt has focus on not a increased a No of mill but focus on
their production or area. Because in india few states are
produced more sugar and other states contribution is not more
so Govt has try to increased their contribution level for sugar
production.
 Such findings on financial analysis we conclude assets is
increased and Investment perform a more part for it so
industry use this Investment in a proper way
 Industry has try to decreased their liabilities for growth of
industry and increased the profitability. 
 Such findings on financial analysis we conclude assets is
increased and Investment perform a more part for it so
industry use this Investment in a proper way
 Such findings on financial analysis we conclude assets is
increased and Investment perform a more part for it so
industry use this Investment in a proper way
 Industry has try to decreased their liabilities for growth of
industry and increased the profitability. 
 In Industry flow of cash high in operating is well but also
Industry has also focus on Investment activity and their
expansion activity. 
 Industry has focus on their industry ratio because they
affect on their growth, 
 Industry has try to work for their rate of return on their Net
worth, capital employed, and Net total assets and also their
profitability also.
 India is a second largest country in the world for
production of sugar only but their growth is return or
profitability is less as compare to other country.
 
Thank you