Eighty-nine percent of sugar is produced in Maharashtra, Karnataka, and Uttar Pradesh, and two major elements that impact the sugar industry are water and the monsoon.
India not only ranks among the top three countries in the world for sugar production, but it also has the highest global sugar consumption.
As a result, even if the ongoing conflict and the epidemic have created market uncertainty, future projections for the sugar industry seem to be on the hopeful side.
Fortunately, everyone who craves sweets resides in India, where sweets are an essential part of many events. The good news is that, especially in India, stocks may now satiate your sweet need.
We will review the best and tastiest sugar stocks in India and provide you with some insider knowledge about the sugar industry in this article. Read on to learn more!
The Sugar Industry: A Synopsis
The sugar industry in India is the second-largest agro-based industry. Over 50 million farmers are supported by this industry.
On the other hand, the sugar industry supports more than 6 lakh people directly and many more indirectly through employment.
But, India’s sugar industry plays a far more significant global role. India is the world’s second-largest producer of sugar.
Only Brazil produced more sugar than the nation, which produced 29 million metric tonnes.
The top nine sugar-producing states in the country are Maharashtra, Gujarat, Bihar, Andhra Pradesh, Haryana, Karnataka, Punjab, Uttar Pradesh, and Tamil Nadu.
Of these states, Maharashtra is recognized as the top producer of sugar in the country. While only 20% of sugar is made from sugar beet, the other 80% is extracted from sugarcane.
In India, sugarcane is used to make the bulk of the sugar consumed there. The price of sugar is directly impacted by the unpredictable nature of sugar production.
Best Sugar Stocks in India 2023
Now that we have a better grasp of this sector, let’s evaluate the leading sugar firms in India.
|Sugar Stocks to Buy
|Shree Renuka Sugars Ltd.
|Triveni Engineering and Industries Ltd.
|EID Parry (India) Ltd.
|Balrampur Chini Mills Ltd.
|Dalmia Bharat Sugar and Industries Ltd.
Important Considerations Before Purchasing Indian Sugar Company Stock
The following is a list of some factors related to sugar stocks:
- Improving Profitability
A by-product of the sugar industry called molasses contains ethanol. When combined with gasoline, this ethanol creates energy that is more cost-effective and environmentally friendly.
To help with this, the administration has established a target of 20% ethanol under the EBP by 2025 and 10% ethanol under the EBP by 2022.
The sugar business has considerably benefited from the EBP program since it can now employ the excess ethanol produced and profit from better margins.
- An Uptick in the Soft Drink Industry
The market growth for soft drinks is the final component or segment of the sugar business. The per capita consumption of soft drinks has increased by around twofold during the previous few years, which has given the sugar sector a further boost.
- Even in a few years, supply will outpace demand.
The government wants to add 20% ethanol to gasoline within the next several years. The total distillery demand, which includes the ENA and rectified spirit, is predicted to reach 1350 crore liters in 5–6 years.
The government also encourages the usage of flex-fuel vehicles. Even beyond 2025, we anticipate that moderate flex-fuel car/bike adoption will increase ethanol consumption, even if broad usage of flex-fuel vehicles would take longer.
- Possibilities for Exporting & Competition
Brazil, the primary competitor for India’s sugar supply, just had elections that might lead to new rules. The price of sugar fluctuates a lot and has considerably decreased in the last 12 months.
Top Sugar Stocks in India: An Overview
Some of the top sugar stocks to purchase are as follows:
Sugar refineries and mills are operated by the agribusiness and bioenergy company Shree Renuka Sugars Limited (SRSL). The company sells sugar, ethanol, power, and organic manure as its product lines.
Moreover, it operates distilleries that produce ethanol and alcohol suited for automobiles using rectified spirits and molasses as biofuels.
Also, the company uses bagasse, a byproduct of the sugar industry, to generate electricity for internal consumption and sells any extra to Brazilian and Indian state networks.
SRSL furthermore deals in raw and white sugar, coal, molasses, and alcohol.
2) Triveni Engineering and Industries Ltd.
Triveni Engineering & Industries Ltd (TEIL), an Indian conglomerate comprising a variety of engineering and sugar businesses, has its headquarters in Noida, India. It was established in 1932.
The company is involved in the manufacture of ethanol, sugar, and alcohol, as well as power cogeneration, power transmission, industrial gears and gearboxes, defense, water purification technology, and FMCG brands.
It is one among the major sugar firms listed on the NSE and the second-largest producer of sugar in India.
3) EID Parry (India) Ltd.
East India Distilleries (EID) Parry Limited is an Indian public company with its headquarters in Chennai, Tamil Nadu, and has been in business for more than 225 years.
As a result, it frequently appears on lists of the best sugar shares.
Among many other firsts, it produced fertilizer for the first time on the Indian subcontinent in 1906. The company now produces and distributes sugar as well as bioproducts. Parry’s is the oldest brand name that is still in use in Chennai.
4) Balrampur Chini Mills Ltd.
On July 14th, 1975, Balrampur Chini Mills Limited (BCML) was founded. It is one of India’s largest integrated sugar producers.
Sugar is largely produced and sold by the company. It is a well-known stock market corporation and is regarded as a top pick by many traders.
The manufacture and sale of ethanol and ethanol, the generation and sale of electricity, and the manufacturing and sale of agricultural fertilizers make up the majority of the Company’s other related commercial operations.
In Uttar Pradesh, the business has eleven manufacturing facilities with a daily cane crushing capacity of 77500 tonnes.
5) Dalmia Bharat Sugar and Industries Ltd.
Dalmia Bharat Sugar and Industries Ltd is one of the success stories with the quickest rate of expansion in the Indian sugar sector.
One of India’s fastest-growing sugar enterprises, Dalmia Bharat Sugar and Industries Ltd, has the confidence of more than 1 Lac farmers.
The corporation began operating in the sugar sector in the middle of the 1990s, and in 1994 Ramgarh, a hamlet in the Sitapur district of Uttar Pradesh saw the establishment of its first plant with a 2500 TCD capacity.
Sugar’s market is very unpredictable and prone to volatility. Despite this unpredictability, the sugar industry has a considerable influence on the Economy of the nation and generates income for both the federal and state governments.
The rise of this business and the creation of new job possibilities are also results of the government’s efforts to produce and mix ethanol in order to provide a cleaner energy source.
Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.
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