Expect trading upside in major sugar stocks: Prashasta Seth

In a chat with ET Now, Prashasta Seth, Senior Fund Manager, IIFL Wealth, shares his views on sugar stocks. Excerpts:

ET Now: What is your view on the sugar space?

Prashasta Seth: We have seen a big correction in sugar stocks. We can expect upside on a lot of the stocks. Given the fact that this is an election year, we would expect government to take that additional mile in order to resolve the issue; otherwise, it might impact their prospects in the election.

However, the big delta for a lot of these companies can come only once the interest rates starts to come off as the balance sheet for a lot of these companies are leveraged; when interest rates come off, we could see a substantial improvement in earnings.