Sugar stocks sweeten market, rise over 5%

MUMBAI: On a day when the market is struggling to find its feet, sugar and sugar integrated companies are in the limelight on the Indian bourses--some rising by more than 5 per cent. Sugar companies with a base in Uttar Pradesh, which is India's second largest sugar producer, are seeing a rally.

Dhampur Sugar (Kashi) rose by more than 6 per cent while Venus Sugar rose by 5 per cent. Others like Triveni, Shakti Sugars, Piccadily Agro, DCM Shriram were up in the range of 4 per cent to 5 per cent. Rajshree Sugar and Dhampur rose by more than 2 per cent each.

A Mumbai-based market participant tracking the sector said, "Cane crushing for the season has peaked in most states, and mills are under pressure to clear old stocks. Some stocks of the new season are also finding their way into the spot markets. As far as UP companies are concerned, they are currently fighting a legal battle against the state advised cane price of Rs 140 per 10 kg, and many are waiting for the court decision before starting crushing."

Hearing in the case started on Nov 18 and though some mills have agreed to pay Rs 125 per 100 kg cane to farmers, they are in minority, he added.

Almost all the stocks were trading well above their two week average weighted volumes on the BSE.