Murugappa Group company EID Parry (India) Ltd has infused around ₹600 crore into its wholly owned subsidiary Parry Sugars Refinery India Pvt Ltd (PSRIPL) to meet debt obligations, with the company expecting to complete all loan repayments linked to the closed Kakinada sugar refinery by June 2026.
The update, shared during the company’s latest earnings call, comes two months after EID Parry announced the shutdown of the loss-making refinery at Vakalapudi in Andhra Pradesh due to sustained losses and a mounting debt burden.
₹732 crore repaid to lenders
As part of the closure process, PSRIPL repaid $49 million, equivalent to about ₹460 crore, to lenders on April 24. The repayment was funded through an equity infusion of around ₹338 crore from EID Parry and cash available with the subsidiary.
A second tranche of $29 million, or approximately ₹272 crore, was repaid on May 15 and was fully funded through investments from EID Parry.
With these two repayments, EID Parry has infused nearly ₹600 crore into PSRIPL by mid-May to meet its debt obligations.
The company said a final repayment of $1.4 million is scheduled for June 2026 and will be funded through receivables available with the subsidiary. Following this payment, all loan obligations of PSRIPL are expected to be fully settled by June 30, 2026.
Employee settlements completed
EID Parry said the closure process is progressing as planned. Settlement of dues for management staff was completed on April 1, while settlements with contractors were concluded by April 15.
The company had informed stock exchanges about the closure on March 31 and subsequently notified all statutory authorities during the first week of April.
SEZ exit process underway
The refinery unit is located within a Special Economic Zone (SEZ), and the company has already received an in-principle exit approval from SEZ authorities on April 20.
Formal exit procedures have commenced and are expected to be completed by September 30, 2026.
Asset sale plans initiated
As part of the winding-down process, EID Parry has begun exploring the liquidation of PSRIPL’s plant and machinery.
Management said discussions have been initiated with potential buyers and vendors, while the company is also considering inviting tenders from interested parties for the sale of assets.
Closure to result in significant provisions
When announcing the shutdown in March, EID Parry estimated PSRIPL’s total liabilities at around ₹998 crore, including bank borrowings of ₹877 crore supported by corporate guarantees from the parent company.
After accounting for expected asset realisations, the company had estimated that around ₹740 crore would need to be settled through fresh equity infusion and loans from EID Parry.
The company had also indicated that it would create provisions of approximately ₹655 crore across FY26 and FY27, in addition to an impairment charge of ₹46 crore on its investment in the subsidiary.
Focus turns to completing exit
With employee settlements completed and most of the debt already repaid, EID Parry’s focus has now shifted to completing the SEZ exit process, monetising assets and concluding the refinery closure.
The exercise marks a major restructuring initiative for the Murugappa Group company as it seeks to address losses from the refinery business and strengthen its balance sheet.