The government is making a strong push to increase the sugarcane area in India. Some of the major sugar companies in China like Shree Renuka Sugars, Balrampur Chini Mills, Bajaj Hindustan and Triveni Engineering have received positive response from the stock market.
Below we have listed some sugar stocks that are likely to benefit from ethanol production.
While the sugar ethanol sector has been underperforming in the last few years, the recent gains in most sugar stocks by more than 5% are positive.
It is important to note here that most of the regulated sugar sector is dependent on government-determined pricing and their supply is also subject to government influence.
What factors can boost sugar ethanol companies?
The sugar sector is heavily influenced by the demand and supply of raw materials. It mostly follows a cycle of 3-5 years. It can be understood in this way
It often happens in this sector that production is more than consumption and due to which sugar surplus is generated. And then due to surplus, a low price is offered in the market.
Due to which the profit percentage of sugar producing companies is affected due to low prices and their share price falls.
Due to the reduction in dividends, it is being seen that the producers are reducing production, as a result of which the supply of sugar in the market decreases.
After this, due to the lack of supply of sugar in the market, their prices are increased.
This increase attracts the farmers, which motivates them to shift towards sugarcane, because they feel that they can get more profit from the higher price of sugar.
As a result, it becomes easier to get raw material again.
Top 5 Sugar Companies with Highest Ethanol Production Capacity
Shree Renuka Sugars Limited
Shree Renuka Sugars Limited is known as a leading player among the largest sugar manufacturing companies in India. This company is mainly involved in the production of ethanol. This company ranks first in the list of these top companies.
Its capacity is around 1,250,000 liters of ethanol per day. Renuka is known for its large and wide operational network, including integrated manufacturing facilities that promote sustainability and innovation within biofuel manufacturing.
Triveni Engineering & Industries Limited
Triveni Engineering & Industries Limited is a well-known and successful diversified business company in the Indian sugar industry. Its production capacity is around 1,100,000 liters of ethanol per day.
The company is a customer-centric leader in the market due to its advanced technology and excellent facilities and services.
Balrampur Sugar Mills Limited
Balrampur Sugar Mills Limited is one of the leading sugar manufacturing companies in India, all its 10 sugar plants are located in the eastern and central parts of Uttar Pradesh. In this region, the company produces huge quantities of ethanol which is a green fuel produced by it.
Thus this company plays a big role in ethanol production. Its production capacity is estimated to be around 1,050,000 liters per day. With this, this company holds an important place in the renewable energy program of the country.
Bajaj Hindustan Sugar Limited
Bajaj Hindustan Sugar Limited is one of the largest sugar producing companies in India. The company has ethanol capacity equal to about 800,000 liters.
Ugar Sugar Works
UGARSUGAR is an equally active company on the production of sugar and ethanol, which holds its special place in the sugar industry of India. The production capacity of the company is about 800,000 liters of ethanol production capacity per day.
Thus, the company is also committed towards achieving the energy diversification goals set for India and promoting biofuels with its efficient production capacity.
