Sugar shares dip on profit booking

Dwarikesh Sugar, Ugar Sugar Works, Oudh Sugar Mills and Upper Ganges are down more than 5% each

Shares of sugar companies have slumped by up to 18% in an intra-day trade on account of profit booking.

At 12:03 AM, Dwarikesh Sugar Industries (down 11% at Rs 236), Ugar Sugar Works (10% at Rs 52), Oudh Sugar Mills (9% at Rs 139), Upper Ganges Sugar & Industries (7% at Rs 384), Uttam Sugar Mills (7% at Rs 87) and Simbhaloi Sugars (6% at Rs 52) are among few sugar stocks that are down more than 5% each on the BSE as compared to 1.4% down in S&P BSE Sensex.

Most of the sugar stocks touched their multi-year highs and appreciated more than 30% in the month of June till Wednesday, as the outlook on profitability growth got further boost.

While international sugar prices continue their northward trajectory, realisations within India are also improving, with the demand-supply equation turning favourable for companies, the Business Standard report suggests. CLICK HERE TO READ FULL REPORT.

As far as the medium- to long-term outlook is considered, in ICRA’s view, the long-term prices and profitability of Indian sugar companies will remain highly cyclical and dependent on domestic and international supply-demand trends.

While sugar prices have improved, the sugar mills’ liquidity is likely to remain under some pressure in the near term as they have to start making debt repayments against the soft loans availed during 2014 and 2015 from this year, which implies additional cash outgo for them, ICRA said in Apri 2016 report.

Company	LATEST	52 WK HIGH	% chg
UGAR SUGAR WORKS	52.35	63.50	-17.6
SAKTHI SUGARS	47.70	56.00	-14.8
SIMBHAOLI SUGAR	52.70	61.20	-13.9
OUDH SUGAR MILLS	139.20	160.95	-13.5
UPPER GANG. SUG.	382.10	438.85	-12.9
UTTAM SUG.MILLS	85.40	98.00	-12.9
DALMIA BHARAT	123.55	141.40	-12.6
KESAR ENTERPRISE	63.00	71.85	-12.3
KCP SUGAR &INDS.	40.00	44.60	-10.3
DHARANI SUGARS	64.20	71.40	-10.1
List of stocks hit 52-week high in intra-day trade
Latest price on BSE in Rs at 12:00 PM