Speaking to CNBC-TV18, Manickam said although the company's realizations may improve but there will not be much change in business plans.
"Most of us are looking at a drought year, so I don't think next year is going to be a great year for production. So, we will not be looking at expansion for the next 24 months," he added.
Also read: CCEA decontrols sugar; companies to save Rs 3,000cr
Below is the verbatim transcript of his interview on CNBC-TV18
Q: Finally we learn that the cabinet has cleared the proposal for sugar decontrol. Does it come with riders, is it partial decontrol those are the questions that we are still rappelling with. The government will be making that announcement shortly but your first take, your first reaction?
A: It is welcome. We are very happy that they have taken decisions finally. Now, the only thing which is remaining is control of the sugarcane price by the states and the price of sugar which is being sold in the market. These are two things which we need to look at.
Q: On the basis of what we know which is in the public domain what Rangarajan had suggested in his report, and we understand that the cabinet has pretty much gone along with what the Rangarajan Committee had proposed. What will this mean for realisations for your company?
A: Probably that Rs 1 will be about Rs 20-25 crore gross as a company that is a basic impact. However, one thing which the government has not gone along with the Rangarajan Committee is addressing the sugarcane price. They have just given it a go by.
Q: Do you believe the sugarcane pricing issue not being dealt with is on account of political implications and the need to cater to a larger political class?
A: Absolutely.
Q: We are still waiting for the government to sort of make clear the proposal that was finally cleared by cabinet but how is this actually going to change business plans for you if at all in any fashion besides the higher realisations that you hope to make from this?
A: We don't see the business plans change very much. We are just dependent on the market growth and India is a growing market for the next 25 years. So, we will just be focusing on increasing our capacities over a period of time.
Q: When you talk about increasing your capacities as far as the new fiscal is concerned can you outline for us the plans that you may have?
A: Nothing immediately, most of us are looking at a drought year so I don't think next year is going to be a great year for production. So, we will not be looking at expansion for the next 24 months. It will happen only after that.
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