Sugar Stocks Surge on Higher Prices for Ethanol Procurement

Shares in sugar companies surged on Thursday after the government approved a mechanism for procurement of ethanol by state-run oil marketing companies.

The government has fixed a price between Rs 48.5-Rs 49.50 per litre, depending upon the distance of sugar mill from the depot of the state-run oil marketing companies for procurement of ethanol for blending with petrol.

The price fixed by the government is much higher than the price of Rs 29 per litre, which oil companies presently pay to buy sugarcane extracts.

Balrampur Chini Mills jumped 9 per cent to Rs 63.7, Bajaj Hindustan was up over 6 per cent at Rs 22.25, while Shree Renuka Sugars surged 6 per cent to Rs 17.80.

Sugar stocks outperformed the benchmark Nifty, which was down 0.8 per cent as of 12.14 p.m.

(With inputs from PTI)