Sugar stocks like Shree Renuka, Bajaj Hindustan, Balrampur rally on decontrol reports

MUMBAI: Shares of sugar companies were in action on reports that the food ministry is seeking the Cabinet approval to de-regulate the sugar sector.

"The food ministry has decided to seek the Cabinet approval to lift controls on sugar, the first time such a proposal will be taken to the highest decision-making body of the government since the sector was brought under strict regulation 50 years ago," said an ET report.

The decontrol of sugar was strongly recommended last year by a committee led by C Rangarajan, the influential head of the economic advisory council of the prime minister.

According to a food ministry official, the government is keen to abolish the system of telling sugar mills how much of the sweetener they can release in the market. It also wants to stop the system of levy sugar, which forces millers to sell a part of their output at below-market price.

Narendra Murkumbi, Vice Chairman & Managing Director, Shree Renuka Sugars, in an interview with ET Now said that looking at the reforms mood of the government, domestic sale control and levy sugar are two issues to be considered on a priority basis.

Sugar prices, which are at seven-and-a-half month low, are likely to revive by March-end as production declines, he said.

At 11:15 am, Bajaj Hindusthan was up 4.81 per cent, Balrampur Chini Mills gained 4.02 per cent, Dhampur Sugar moved 4.73 per cent higher and Shree Renuka Sugars was up 2.82 per cent.