Purpose The present paper aims to analyse the efficiency and productivity patterns of firms operating in the Indian sugar industry. The study also examines the impact of some firm-specific determinants on these efficiency levels. Design/methodology/approach The present study utilises the Data Envelopment Analysis (DEA) method to measure the technical efficiency of 57 Indian sugar firms. Data about four input variables, namely raw material, labour, capital, energy and one output variable, namely, net sales revenue, for the period from 2013 to 2023, were extracted from CMIE. In the second stage, Tobit regression was applied to examine factors influencing efficiency scores. The Malmquist Productivity Index (MPI) was also used to analyse total factor productivity over time. Findings The average Overall Technical Efficiency (OTE) for 2023–24 is 0.842, suggesting a 15.8% potential reduction in inputs without lowering output. Scale efficiency (0.973) exceeds pure technical efficiency (0.867), indicating that inefficiencies mainly arise from managerial issues rather than from the scale of operation. Larger and more capital-intensive firms are generally more efficient, while labour-intensive firms tend to exhibit lower efficiency. Total Factor Productivity (TFP) increased by 2.2% annually, driven by 1.4% technological progress and 0.7% efficiency gains. Research limitations/implications The present study is limited to financial data and does not consider the performance of by-products such as ethanol and molasses. Originality/value In India, few studies have analysed the functioning of sugar companies utilising the Data Envelopment Analysis approach, the Malmquist Productivity Index and Tobit regression.
Makkar et al. (Mon,) studied this question.