Chinese stocks are in the news these days for giving great returns to their shareholders. Sugar major Dhampur Chini share price rose nearly 4 per cent today, while it has supplied nearly 40 per cent to its shareholders in the past one month. The share price of Triveni Engineering rose 4.50 per cent today, while it has gained almost 22.50 per cent in the last one month. Similarly, shares of Dwarikesh Chini rose over 6 per cent today, while it has gained nearly 44 per cent in the past one month. Dalmia Bharat sugar price today moved north by 5.50 per cent, while it has risen by around 26 per cent in the past one month.
According to stock market experts, sugar stock These are skyrocketing due to two major reasons – rising commodity prices and the ethanol blending policy of the Government of India. He said that because of flying crude oil And in other commodity prices, the Indian government is focused on increasing ethanol blending in diesel and petrol from the current 7-8 per cent to about 20 per cent. However, the domestic ethanol supply is unable to meet this demand. So these days ethanol blending business of sugar mills is increasing. Apart from this, due to increase in commodity prices, sugar prices have also increased. In such a situation, Chinese companies are getting the double benefit of the existing market structure.
Speaking on the reason for the skyrocketing price of Chinese shares; Saurabh Jain, Vice President – Research at SMC Global Securities said, “To counter the rising crude oil prices, the Government of India has announced the Ethanol Blending Policy. This has created an additional revenue opportunity for the Chinese companies. Amidst the rise in prices of sugar, sugar prices have also moved higher and they are expected to remain at higher levels in the near future. Hence, Dalal Street is extremely bullish on Chinese stocks and these are the two reasons why sugar is moving north. Running the stock.”
Elaborate on India’s ethanol blending policy and its impact on Indian sugar companies; Avinash Gorakshakar, Head of Research, Profitmart Securities, said, “To counter the dollar outflow from India, the Government of India has announced an ethanol blending policy, wherein they seek to increase the use of ethanol in petrol and diesel from the existing 7-8 per cent. are planning to do 20 percent. However, there is a shortfall in the supply of ethanol and hence sugar companies producing ethanol in large quantities are expected to get huge benefits from this new move of the Government of India.This policy of the Government of India Sugar The company is expected to remain a milking cow and this could have a long-term positive impact on their balance sheets.”
For buying today on Chinese stocks; Saurabh Jain of SMC Global said, “One should buy quality and large company shares as they are equipped with high ethanol production. Hence, it is better to buy quality sugar company stocks like Balrampu Balrampur Chini, Triveni Engineering and Dhampur Sugar. Is.
Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
download
The app will get 14 days of unlimited access to Mint Premium absolutely free!