Sugar Stocks Rally On Reports Of Possible Ethanol Price Increase
Sugar stocks' market-cap on NSE rose Rs 1,733.25 crore to Rs 58,933 crore as of 1:58 p.m.
Most sugar companies' stocks rallied on Tuesday after news reports said the government was considering an ethanol price hike starting November. Government aims to achieve 20% blending target by 2025-26, PTI reported citing a source.
Sugar stocks' market-cap on NSE rose Rs 1,733.25 crore to Rs 58,933 crore as of 1:58 p.m.
It's high time for a price announcement because cost of production is going up as government has been tweaking the minimum support price, said M Manickam, chairman and managing director, Shakti Sugars Ltd. But the policies are not linked as of now, he said.
In terms of profitability, there will not be much differences as it will be for cash flow. For farmers, it will be good to liquidate the stock. So, if the ethanol prices go up, the cash will flow from oil to sugar companies, and they will pay the farmers better.
Shares of Triveni Engineering and Industries Ltd. led gains jumping 8% to a fresh high of Rs 421.70 per share on Tuesday. They were trading 7.32% higher at Rs 419.05 as of 2:01 p.m.
Bajaj Hindusthan Sugar Ltd. stock followed with 6.44% intraday gain. The stock was 4.93% higher at Rs 41.05 as of 2:01 p.m.
Meanwhile, EID Parry India Ltd. emerged as the top loser among sugar stocks on Tuesday with 2.96% intraday decline. It was 1.58% lower at Rs 785.95 apiece as of 2:02 p.m.
