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Uttam Sugar Mills gained over 3 percent in morning trade on Wednesday after the company’s board approved the expansion plan at an estimated investment of Rs 100 crore.

As part of the expansion plan, the company’s board at its meeting on January 10 approved the proposal for increasing its distillery and cane-crushing capacities in Uttar Pradesh. The distillery capacity of ethanol will go up from 150 KLPD (kilo litre per day) to 250 KLPD at the Barkartpur plant.

The capacity addition is scheduled to be completed by December 2023. The company is investing Rs 56 crore in enhancing capacity by 100 KLPD.

The company will be raising funds for the expansion plan via internal accruals and loans under the interest subvention scheme of the department of food and public distribution, Government of India.

The company has also decided to increase distillery capacity to produce more ethanol at the Barkatpur plant as the Central government is encouraging ethanol blending with petrol.

Uttam Sugar Mills Ltd. is also in the process of increasing its cane crushing capacity by 2,450 TCD (tons of cane per day) from the existing 23,750 TCD at an investment of Rs 40 Crore. The company is expecting to complete the capacity expansion by November this year and is raising funds through internal accruals and loans.

The company has undertaken an intensive Cane Development Programme to increase yield and sugar content in the cane. Toward this objective, it has decided to install the balancing equipment to take care of additional cane availability and higher sucrose content in the cane.

The company hopes for improvement in operating performance and energy efficiency of the plants as well as resultant capacity enhancement.

Uttam Sugar Mills stock ended trading at Rs 306, up 0.61 percent, on Wednesday.

(Edited by : Rukmani Krishna)