Praj Industries Sees A Potentially Big Opportunity Beyond Ethanol
India’s ethanol manufacturing capacity could rise threefold as the nation allowed production from feedstocks other than sugarcane and targets higher blending with petrol, according to biofuels maker Praj Industries Ltd.
The nation advanced the target for 20% ethanol blending by oil retailers to 2025 to cut dependence on costly imports. And it has now allowed production using grains such as barley, maize, corn and rice to make second-generation ethanol. First-generation bio-ethanol is produced from sugarcane.
“At 5%, we are blending 350 crore litres of ethanol,” Shishir Joshipura, managing director and chief executive officer at Praj Industries, told BloombergQuint’s Niraj Shah in an interview. “And we have to add another 1,000 crore litres of manufacturing capacity over the next five years, the reason why this is generating excitement.”
Given the policy push, setting up a bio-ethanol project is a very viable option, he said. And producers include sugar companies and ESG funds to oil retailers themselves. Inquiries have doubled against last year for Praj Industries, according to Joshipura.
The average capacity used to be 60,000 litres a day, going up to 1,50,000 litres, he said. “People are now putting up a minimum of 1,50,000 litres per day plant, going up to 5,00,000 litres a day. This opens up a business opportunity of nearly Rs 14,000-15,000 crore over the next four years.”
Ethanol is not the only opportunity the company is targeting. Orders for bio-CNG or gas made from organic waste, and waste-water treatment are also growing, according to Joshipura. The company received an order worth Rs 200 crore from Indian Oil Corp. for waste-water treatment earlier this year.
Bio-CNG is much more ambitious than the ethanol programme and the potential could be as big as Rs 1.75 lakh crore, he said.
Together with supplying equipment to pharma companies, Joshipura said the growth for Praj Industries will be multi-layered.
Watch the full interview here: