Strong earnings growth ahead for listed sugar companies' stocks

The blend ratio targeted is 20 per cent (80 percent petrol with 20 per cent ethanol) for Nov '24-Oct '25, up from an estimated 14 per cent in Nov '23-Oct 24

Sugar stocks went up sharply on Friday on the news of a major policy change on ethanol as the industry gears up for the next crushing season. In December 2023, a cap was imposed on the quantum of sugar that could be diverted to produce ethanol to prevent a squeeze in sugar supplies ahead of the elections.

That cap has now been removed for the period November 1, 2024-October 31, 2025, which means sugar mills can fully exploit the opportunity for ethanol blending with petrol.

The notification allows sugar mills and distilleries to produce ethanol from sugarcane