Shree Renuka Sugars Ltd.(SRSL) is an integrated manufacturing company with strategic focus on sugar and its allied products viz. power and ethanol. It sells its products in the domestic as well as international markets and is the second largest exporter from India. The company has a robust business model to counter cycles in sugar sector. It has invested significantly in raw sugar refining capacities and has diversified into ethanol capacities, thus differentiating itself from other sugar companies in India. The company has been looking to secure raw material through acquisition of cane crushing units in Brazil, the largest cane producing country in the world. It recently completed the acquisition of a controlling stake of 50.34% in Equipav S.A. Açúcar e Álcool (Equipav), a Brazilian sugar and ethanol production company; this has made it one of the largest sugar companies in Brazil.
- So, what will its unique business model do for its future?
- At its current price, what should be your investment decision?