5+ Best Sugar Stocks in India 2023

India is not only among the top three producers of sugar worldwide, but it also consumes the most sugar globally. As a result, despite the market uncertainty that was brought on by the war and the epidemic, future predictions for the sugar business appear to be somewhat optimistic.

In this blog, we will provide you with some insider knowledge about the sugar business and examine the most excellent and tastiest Sugar Stocks in India. To find out, read on!

 

The Sugar Industry: A Synopsis

The second-largest agro-based industry in India is the sugar sector. The sector supports about 50 million farmers. But, on the other hand, the sugar sector also directly employs over 6 lakh people and indirectly supports many more.

However, the sugar sector in India has a considerably more prominent worldwide role to play. India is the world’s second-largest producer of sugar. After Brazil, the nation produced 29 million metric tons of sugar.

Maharashtra, Gujarat, Bihar, Andhra Pradesh, Haryana, Karnataka, Punjab, Uttar Pradesh, and Tamil Nadu are the top nine sugar-producing states in the nation.

Maharashtra is regarded as the nation’s leading sugar producer among these states. 20% of sugar is produced from sugar beet, while 80% comes from sugarcane extraction. The majority of the sugar used in India is made from sugarcane. The erratic nature of sugar output directly impacts the price of sugar.

 

Best Sugar Stocks in India 2023

Let us review the top sugar companies in India now that we have a better understanding of this industry.

 

Sugar Stocks to Buy

1. Shree Renuka Sugars Ltd
2. Triveni Engineering and Industries Ltd.
3. EID Parry (India) Ltd.
4. Balrampur Chini Mills Ltd.
5. Dalmia Bharat Sugar and Industries Ltd.

 

Factors to Note Before Investing in Sugar Companies Stock in India

Improving Profitability

Ethanol may be found in molasses, a by-product of the sugar industry. This ethanol produces a more reasonably priced and ecologically beneficial energy when coupled with gasoline.

The administration has set the goal of integrating 10% ethanol under the EBP by 2022 and 20% by 2025 in order to support this. Since it can now use the extra ethanol generated as part of the EBP program and profit from higher margins, the sugar industry has significantly profited.

 

An Uptick in the Soft Drink Industry

The last area or part of the sugar industry is the market expansion for soft drinks. The approximately two-fold increase in per capita consumption of soft drinks over the past few years has given the sugar industry another big boost.

 

Even After the Next Few Years, Supply Is To Surpass Demand

By the next couple of years, the government intends to mix 20% ethanol. By 5-6 years, the entire distillery demand—including the ENA and rectified spirit is anticipated to reach 1350 crore litres.

Additionally, the government promotes the use of flex-fuel cars. Although widespread use of flex-fuel vehicles will take longer, we expect that moderate flex-fuel car/bike adoption will drive up ethanol consumption even after 2025.

 

Possibilities for Exporting & Competition

Brazil, India’s main adversary in the supply of sugar, just held elections that might result in new regulations. The price of sugar is quite erratic and has somewhat reduced over the past year.

 

Top Sugar Stocks in India: An Overview

Following are some of the best sugar stocks to buy-

 

1) Shree Renuka Sugars Ltd. Agribusiness and bioenergy firm Shree Renuka Sugars Limited (SRSL) runs sugar refineries and mills. The product line offered by the corporation comprises sugar, ethanol, electricity, and organic manure.

In addition, it runs distilleries that use molasses and rectified spirits as biofuels to create ethanol and alcohol suitable for vehicles. Additionally, the business produces power from bagasse, a sugar industry waste product, for internal use and sells any excess to state grids in Brazil and India. Also, SRSL trades raw and white sugar, coal, molasses, and alcohol.

 

2) Triveni Engineering and Industries Ltd. With its headquarters in Noida, India, Triveni Engineering & Industries Limited (TEIL) is an Indian conglomerate with diverse engineering and sugar industries. In 1932, it was formed.

The firm works in ethanol production, sugar and alcohol production, power co-generation, power transmission, industrial gears and gearboxes, defence, water purification technologies, and FMCG brands. It is India’s second-largest producer of sugar and one of the top sugar companies listed in NSE.

 

3) EID Parry (India) Ltd With its headquarters in Chennai, Tamil Nadu, East India Distilleries (EID) Parry Limited is an Indian public corporation that has been in operation for more than 225 years. As a result, it is often found in the top sugar shares list.

Its accomplishments include the first fertilizer manufacture in the Indian subcontinent (1906), among many other firsts. Currently, the firm is involved in the production and distribution of sugar and bioproducts. The oldest commercial name still in use in Chennai is Parry’s.

 

4) Balrampur Chini Mills Ltd. The Balrampur Chini Mills Limited (BCML) company was established on July 14, 1975. It is a significant integrated sugar manufacturer in India.

The Company produces and sells sugar primarily. It is a renowned company in the stock market and is considered a top choice by many traders. Other than this, the Company’s linked business operations mainly involve the production and selling of ethanol and ethanol, the generation and sale of electricity, and the production and sale of agricultural fertilizers.

The company runs ten production facilities in Uttar Pradesh with a daily cane crushing capacity of 77500 tons.

 

5) Dalmia Bharat Sugar and Industries Ltd.

One of the Indian sugar industry’s fastest-growing success stories is Dalmia Bharat Sugar and Industries Limited. More than 1 Lac farmers trust Dalmia Bharat Sugar and Industries Limited, one of India’s fastest-growing sugar companies. The corporation entered the sugar industry in the middle of the 1990s, and in 1994 the first facility, with a capacity of 2500 TCD, was established at Ramgarh, a hamlet in the Sitapur region of Uttar Pradesh.

 

Conclusion

Sugar is volatile and has a high level of market unpredictability. However, despite this volatility, the sugar business considerably impacts the country’s GDP and provides revenue to the federal and state governments.

The government’s efforts to manufacture and blend ethanol to offer a cleaner energy source have also led to the growth of this industry and the creation of new job opportunities. Investors should carefully consider these factors and conduct thorough research before investing in sugar stocks in India in 2023.