The stock of sugar is traded higher today because investors expect strong income driven by aggressive ethanol blending programs.
Balrampur Chini Mills rose 7%, sugar and industrial Dalmia Bharat up 6%, Triveni Engineering 7%, Eid al-Fitr parry 4%, Sugar Shree Renuka 4.4%, 9% Uttam Sugar Factory, Sugar Avadh 7% and sugar Dwaricesh 5, 4%.
“We remain bullish in the sugar sector (especially efficient companies) because of government policy (price of sugar cane / minimum support / stock support price / export subsidies / ethanol prices) will ensure the weakest survival. Therefore, the sugar company is well managed Can produce large profit / cash flow, “JM financial report said.
“We believe the current ethanol prices are significantly above the price of gasoline and alcohol imports because the government aims for twin purposes: Sugar Surplus is transferred to ethanol (reducing the burden of subsidies), and reducing carbon emissions and dependence on crude oil imports,” added reports.
In October, the government announced incentives to encourage sugar companies to divert the excess stock of sugar cane in producing ethanol, which can be mixed with gasoline and used as a vehicle fuel.
The government continues to encourage an aggressive ethanol blending program as reflected in a 3-5% increase in the increase in ethanol prices, sustainable assistance for capacity expansion and strong demand from oil marketing companies (a blazing of 5.69 billion liters for 10% liters).
Oil marketing companies have contracted 3.69 billion liters of ethanol for the current marketing year (December-November) and other 0.94 billion liters must be contracted in the next few weeks, JM’s financial statements said.
The price of domestic and global sugar is also expected to remain firmly in the middle of a lower inventory.
