In a lackluster market, sugar stocks were leading higher. Reports that the government may raise ethanol prices for the season beginning in November 2024 coincided with the spike in sugar share prices. According to sources cited by news agency PTI, "the price revision is being considered on priority to incentivize production and meet our blending goals."
A joint secretary from the petroleum ministry is leading a group that has already discussed the issue once. The study also said that the fair and compensatory price of sugarcane will serve as the foundation for the modification of ethanol pricing.
Individual share prices increased by 8.6% to Rs 424 for Triveni Engineering and Industries, 6.4% to Rs 41.64 for Bajaj Hindusthan Sugar, 5.4% to Rs 522.6 for Balrampur Chini, 5.1% to Rs 49.98 for KCP Sugars and Industries, and 4.5% to Rs 48.2 for Shree Renuka Sugars. Indeed, today marked a two-year high for Balrampur Chini Mills as the firm posted a consistent performance for the June 2024 quarter (Q1FY25).
The company's total performance was bolstered by improvements in sugar segment volumes and realizations, as stated. Since India has sufficient supplies of sugar, experts anticipate that the ethanol-blending scheme would resume, just as it did prior to Sugar Season (SS) 23.
In Q1FY25, Balrampur Chini reported a rise in earnings before interest, tax, depreciation, and amortization (Ebitda) of 1.8% year-over-year (Y-o-Y) to Rs 166.13 crore from Rs 163.18 crore in Q1FY24. Operating revenue increased 2.3% year over year to Rs 1,421.60 crore. The sugar industry has performed well in a seasonally slow quarter, despite regulatory concerns posing hurdles to distillery operations. Higher volumes and realizations have contributed to this success.
At 2:25 PM, the following sugar prices increased: Davangere Sugar, Dwarikesh Sugar, Rana Sugars, Vishwaraj Sugar, and Dhampur Sugar. In contrast, the BSE Sensex dropped more than 600 points, or 0.8%, to a level of 79,011.
Prices for ethanol have not changed since November through October in 2022–2023. The price per liter of ethanol made from cane juice is currently Rs 65.61, but the prices per liter of ethanol made from B-Heavy and C-Heavy molasses were Rs 60.73 and Rs 56.28, respectively.
According to the article, the committee is investigating the modification of ethanol made from sugarcane pricing. This is in response to demands made by the sugar sector for higher ethanol prices, a rise in the minimum sugar selling price, and authorization for sugar exports.
