Balrampur Chini, Dhampur Sugar and other sugar stocks rally up to 11% as govt approves ethanol price hike
Balrampur Chini Mills and Dhampur Sugar Mills, soared up to 11% on Wednesday following the government's approval of a price hike for ethanol, a key byproduct of sugar production.
Balrampur Chini Mills saw a rise of 5.3%, reaching Rs 504.95 on the BSE, while Dhampur Sugar Mills surged nearly 11%, climbing to Rs 157.9. Shree Renuka Sugars also gained 7.3% to Rs 38.40. Other sugar stocks also saw notable gains, including Bannari Amman Spinning Mills, which climbed 4% to Rs 43, while Uttam Sugar Mills, Dalmia Bharat, and EID Parry India also saw increases, with gains of 6.13%, 2.97%, and 4.05%, respectively.
The rally follows a report from ET Now that the Cabinet Committee on Economic Affairs (CCEA) has approved a price hike for ethanol produced from sugarcane derivatives. Details of the proposal are yet to be known.
Sources confirmed that the price of ethanol made from B-heavy molasses will likely increase by approximately Rs 2 per litre, while the price of ethanol made from sugarcane juice will rise by Rs 1.50 per litre. The cabinet is also likely to regularise incentives provided by oil marketing companies for ethanol produced from C heavy molasses, ET Now reported. This move is expected to enhance the profitability of sugar mills that produce ethanol, as higher ethanol prices directly boost their margins.
Additionally, the government has approved the allocation of Rs 18,000 crore for the Critical Mineral Mission, which further buoyed investor optimism in the sector. This policy push aims to incentivize sugar
