Sugar shares in focus: Dwarikesh Sugar up 10% on heavy volumes
Ugar Sugar Mills, Uttam Sugar Mills, Dhampur Sugar, Simbhaoli Sugar and Balrampur Chini Mills were up more than 2% on the BSE.
Shares of sugar companies have moved higher by up to 10% on the BSE on back of heavy volumes.Dwarikesh Sugar Industries, Triveni Engineering Industries, Ugar Sugar Mills, Uttam Sugar Mills, Dhampur Sugar, Simbhaoli Sugar and Balrampur Chini Mills were up more than 2%. On comparison, the S&P BSE Sensex was down 0.15% at 32,828 points at 03:09 PM.
According to Indian Sugar Mills Association (ISMA), October-November sugar production was at 39.5 lakh tone. This is about 11.69 lakh tons higher than the production in the last season upto the same corresponding period when 27.82 lakh tons of sugar was produced.
Sugar season 2017-18 SS started with an opening balance of around 38.76 lakh tons, which is the lowest ever in the last several years. With an anticipated normal sugar production of about 251 lakh tons and imports of about 2.85 lakh tons (of whites equivalent), the total availability of sugar in the current season is estimated at 292.61 lakh tons, ISMA said in a press release.
Against this, domestic consumption of sugar is estimated at around 250-252 lakh tons (growth of around 2.5%). As such, the closing balance on 30th September 2018, is expected to be about 40-42 lakh tons i.e. almost equal to the opening balance of this year, it added.
The Cabinet Committee on Economic Affairs had last month given a nod a revision in the price ethanol for supply to the public sector oil marketing companies under Ethanol Blended Programme (EBP) for the procurement season 2017-18 (starting December 2017).
With this announcement in price rise and increase in sugarcane supply in 2017-18, ethanol production is likely to remain higher during the year. This, in turn, will help the sugar industry to move towards the target of EBP, according to CARE Ratings.
The expected rise in supply of ethanol in addition to price rise is likely to benefit the sugar industry’s profitability, it added.
Source: business-standard:Published on 2017-12-05