Sugar stocks drop as UP raises sugarcane prices
Premium(Hindustan Times )
Balrampur Chini shed 9.5%, Dhampur Sugar and Shree Renuka fell 6.5% and 2.5%, respectively, on BSE
Premium(Hindustan Times )
Mumbai: Shares of sugar manufacturers such as Balrampur Chini Mills Ltd, Dhampur Sugar Mills Ltd and Shree Renuka Mills Ltd slumped on Monday as the Uttar Pradesh (UP) government raised cane prices, dealers said.
Balrampur shed 9.5% on BSE on Monday. Dhampur Sugar Mills and Shree Renuka fell 6.5% and 2.5%, respectively. The benchmark Sensex was little changed at 19,409.69 points.
The price of Rs2,920 per metric tonne landed cost for the current sugar season is much higher than expected, Morgan Stanley analyst Girish Achhipaliah said in a note.
He added that the profitability of north Indian millers is likely to be dented as this would imply no profits for the sugar division at the operating level, with the additional interest burden to deal with.
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