Agri-linked stocks soar up to 13% on hike in MSP for paddy

Shares of companies related to agriculture sector surged up to 13 per cent today after the government hiked the minimum support price for paddy by a record Rs 200 per quintal.

Kohinoor Foods soared 12.96 per cent, LT Foods 7.01 per cent and Chaman Lal Setia Exports 2.27 per cent on BSE.

Fertiliser stocks also saw buying, where Coromandel International rose 3.33 per cent, Deepak Fertilisers & Petrochemicals Corporation 1.71 per cent, Rashtriya Chemicals and Fertilisers 0.92 per cent and Chambal Fertilisers & Chemicals 0.16 per cent.

"After an insipid start, market gained momentum on account of better auto sales and government's announcement of increase in minimum support price (MSP).

"Rural income and spending power will increase due to higher minimum price and progressing monsoon which may result in higher demand for consumption oriented stocks," said Vinod Nair, Head of Research, Geojit Financial Services.

The government today hiked the minimum support price for paddy by a record Rs 200 per quintal. The cabinet has approved the MSP of 14 kharif (summer-sown) crops for the 2018-19 season.