Improvement in share price of sugar companies due to policy of promotion of ethanol production

31-Aug-2024 01:19 PM

Mumbai. To increase the domestic production of ethanol in the 2024-25 marketing season (November-October), the Central Government has allowed millers and distillers to use sugar as per their choice and requirement in ethanol exports and the quantitative control imposed on it in the 2023-24 season has been abolished.

Due to this, there was some improvement in the share price of sugar producing companies engaged in the production of ethanol on the previous day.

A government notification said that during the new marketing season starting from November 1, 2024, the sugar industry will be allowed to use sugarcane juice or syrup as well as both categories of molasses (B-heavy and C-heavy) to produce ethanol.

This decision of the government will increase the production of ethanol in the country and the revenue of sugar millers / distillers.

Market analysts say that the share price of sugar producing companies may increase further. The credibility and income of the companies will increase.

A total of 37 sugar companies are listed on the Bombay Stock Exchange, out of which the share price of 35 firms increased on August 30.

Most of these are well-known companies. The increase in the share price of the companies will give them good income which will help in increasing the production of sugar and ethanol.

The government has provided ample opportunity to the sugar companies to formulate their strategy by announcing its decision at the right time.