India sugar stocks surge on higher prices, festive-season demand
Indian sugar stocks experienced a significant surge on Monday, driven by higher domestic prices and expectations of constrained supplies ahead of the festive season. Bajaj Hindusthan Sugar saw an impressive gain of over 11%, while Shree Renuka Sugars rose by 8.5%. Dwarikesh Sugar Industries jumped 10%, Dhampur Sugar Mills climbed 5.2%, and Avadh Sugar & Energy increased by 4.5%.
The broader rally in sugar stocks reflects the impact of rising prices due to tight supplies and stronger demand during the festival season. In an effort to alleviate supply issues, India has approved duty-free imports of 1 million metric tons of raw sugar. However, most of the imported sugar is not anticipated to arrive until October. Additionally, delayed monsoon conditions and the effects of El Nino have further tightened near-term availability.
Despite these challenges, sugar stocks have benefited from the government's measures aimed at curbing prices through import restrictions and stockholding limits.
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