Shares of sugar companies such as Bajaj Hindustan, Triveni Engineering, Balrampur Chini Mills, Oudh Sugar Mills and Dwarikesh Sugar are trading higher by 2-10% each on hopes of getting sugarcane arrears post assembly election results of the Uttar Pradesh, country’s most populous state this month.
“The arrears have jumped to over Rs 2,600 crore in Uttar Pradesh — the country’s biggest sugarcane producing state, having top sugar companies. Another Rs 1,100 crore is pending for two past seasons following a Supreme Court judgment in January,” the report suggests.
The sugar companies will be most affected if BSP retains power, fearing its pro-sugarcane farmer stance. The regime had doubled the price of sugarcane in its five-year tenure, compared with the Samajwadi Party government, which raised it only 25%
The surveys showed the Samajwadi Party winning by far the largest number of seats in the legislative assembly of Uttar Pradesh. The results will be declared tommorow.
Among individual stocks, Oudh Sugar Mills has rallied 10% at Rs 29, followed by Riga Sugars and Mawana Sugars (up 5% each), Bajaj Hindustan (up 4%) and Triveni Engineering (up 3%) on the Bombay Stock Exchange.
