Sugar stocks rally on heavy volumes; Dwarikesh, Upper Ganges up 10%

Dwarikesh Sugar, Oudh Sugar, Upper Ganges, Parrys Sugar and Simbholi Sugars were up 8%-15%.

Shares of sugar companies have rallied by up to 15% in Friday’s trade in otherwise subdued market on back of heavy volumes.

Dwarikesh Sugar Industries, Oudh Sugar Mills, Upper Ganges Sugar, Parrys Sugar Industries, Uttam Sugar Mills, Dharani Sugar & Chemicals, Mawana Sugars, Rajshree Sugars and Simbholi Sugars were up 8% to 15% on the BSE. At 11:46 am; the S&P BSE Sensex was up marginally by 0.15% at 26,019.

Dwarikesh Sugar Industries has rallied 10% to Rs 291 on the BSE on back of seven-fold jump in trading volumes. A combined 1.31 million shares have already changed hands on the counter so far on the BSE and NSE.

The credit rating agency ICRA had recently upgraded the long-term rating for bank loans from [ICRA] BBB- to [ICRA] A-. The outlook on the long-Term rating has been revised to ‘Stable’ from ‘Positive’.

The three-notch upgrade in rating is a result of significant improvement in the financials of the company post the recent equity infusion via QIP and strong cash flows in the last few quarters. Further, the ratings factor a substantial improvement in the sugar recovery rates which has resulted in an improved cost structure as well as the continued favorable outlook for core business, ICRA said on December 7, 2016.

The rating continues to factor in company’s satisfactory crushing performance, healthy recovery rates and the forward integration into cogeneration and distillery businesses, which provide alternate revenue streams and reduce the impact of the cyclicality of the sugar business to an extent, it added.

Upper Ganges Sugar & Industries has locked in upper circuit of 10% at Rs 272 on the BSE with only buyers were seen on the counter. A combined 352,752 shares changed hands and there were pending buy orders for 74,153 shares on both the exchanges.

According to Business Standard reports, sugar mills in Uttar Pradesh are expecting better days ahead due to sharp variation in the climate yielding 0.5% higher recovery this year higher than last year.

The increase in recovery would proportionately help raise sugar output this year. With sugar price remained elevated, declined Rs 1 - 1.50 a kg due to lack of lifting due to demonetisation which analysts expect to recover with the pace of ease in liquidity, mills are expected to earn better profitability this year than the previous year, added report. CLICK HERE TO READ FULL REPORT.

COMPANY	LATEST	PREV CLOSE	GAIN(%)
OUDH SUGAR MILLS	102.50	89.20	14.91
PARRYS SUGAR	45.90	39.95	14.89
DHARANI SUGARS	32.00	27.95	14.49
UTTAM SUG.MILLS	50.40	44.25	13.90
DWARIKESH SUGAR	294.00	264.70	11.07
RANA SUGARS	9.06	8.17	10.89
THIRU AROOR. SU.	53.45	48.50	10.21
UPPER GANG. SUG.	271.50	246.85	9.99
GAYATRI SUGARS	9.05	8.23	9.96
MAWANA SUGARS	45.40	41.35	9.79
SAKTHI SUGARS	33.45	30.80	8.60
SIMBHAOLI SUGAR	28.05	25.85	8.51
EMPEE SUGARS	7.47	6.91	8.10
DALMIA BHARAT	126.00	116.90	7.78
RAJSHREE SUGARS	54.00	50.10	7.78
DCM SHRIRAM INDS	224.00	209.75	6.79
KESAR ENTERPRISE	40.30	37.85	6.47
PONNI SUG.ERODE	204.15	192.00	6.33
TRIVEN.ENGG.IND.	56.55	53.60	5.50
DHAMPUR SUGAR	119.25	113.45	5.11