Sugar stocks gain on reports government may allow further exports

NEW DELHI: According to ET Now, shares in sugar companies gained today on reports that the government might allow further sugar exports this year.

An Empowered Group of Ministers (EGoM) on food, headed by Finance Minister Pranab Mukherjee, is scheduled to meet on August 12th, Friday to decide on allowing more sugar exports and lifting ban on wheat exports.

At 11:20 AM, shares in Bajaj Hindusthan were up 2.9%, Shree Renuka Sugars was trading higher by 3%, Simbhaoli Sugars rose 3.3%, E.I.D. Parry (India) was up 2.1%, Balrampur Chini Mills gained 1.6% and Triveni Engineering & Industries rose 0.34%.

Reports say that the government has so far allowed sugar export of one million tonnes under Open General Licence (OGL) in two tranches as the country's sugar production in 2010-11 has exceeded demand.

Sugar production of India, the world's second-largest producer and biggest consumer, is estimated at 24.2 million tonne in the 2010-11 season as compared to around 19 million tonne last year while the annual demand is pegged at 21-21.5 million tonne.

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However, Sensex was trading lower by 47 points at 17,084.67.

Analyst Call:

"Sugar stocks today are looking quite good for trading. The break-out range to look forward in Shree Renuka Sugar Ltd for day-traders is above Rs 63.50 and investor's can keep a stop loss at Rs 63.00", said Deepak Mohoni, Director, Trendwatchindia. com