Renuka Sugar and Ugar Sugar look attractive: Jagdish Malkani

In a chat with ET Now, Jagdish Malkani, Member NSE, shares his stock ideas.

What is the call on sugar space?

Clearly, there is tremendous speculation going on in international sugar. Domestically, of course, one has to remember that especially the southern sugar companies, especially those in Karnataka and even EID Parry, have a huge advantage of being fairly diversified. They are getting extremely buoyant prices in power at the moment, and added to which Renuka which has pretty much become the leader of the market being 60-70% based in Brazil with productions. There you have the ethanol kicker. Ethanol prices are very buoyant. In fact, it is even-steven between what to produce more in Brazil.

So, the fall both in international prices and in our stock prices here has been overdone. If you had to pick a couple of stocks, Renuka in the large sector and in the small stocks there is a stock called Ugar Sugar, which has been having heavy depreciation etc., now all that is getting behind it and every expectation you earn something like 40 odd crores FY12 which gives you an EPS of Rs 4 and that means this trade thing at something like 4 times earnings which is very reasonable and doing very well with power, etc.