Sugar companies shares sweeten on hopes of price decontrol, Dhampur Sugar Mills leads
Shares of Dhampur Sugar Mills surged 3.28 per cent to Rs 48.75, while Triveni Engineering & Industries rose by 2.18 per cent to Rs 16.40 and Shree Renuka Sugars was up 1.7 per cent at Rs 26.90 on the BSE.
Among others, Simbhaoli Sugars climbed 1.03 per cent, Bajaj Hindusthan (1.15 per cent), Dwarikesh Sugar Industries (1.82 per cent) and Sakthi Sugars (1.96 per cent).
Analysts said that sugar companies gained on hopes of removal of a requirement that they sell a portion of their sugar output to the government at reduced prices.
"Sugar stocks rose in a knee-jerk reaction to reports that the government is planning to decontrol the sector," Ashika Stock Brokers, Research Head, Paras Bothra.
Food Minister K V Thomas had said last week that the proposal on removal of levy sugar obligation may come before the Cabinet Committee on Economic Affairs (CCEA).
Under the levy sugar system, mills are required to sell 10 per cent of their output to the Centre at cheaper rates to run ration shops, costing Rs 3,000 crore to industry annually.
The BSE 30-stock index, Sensex, ended the day at 19,293.20, down 134.36 points.
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