India achieved its target of 12% ethanol blend for supply year 2022-23 but may miss its 15% target for 2023-24 unless grain-based ethanol production is ramped up.
“Eventually, there will be a rethink on Govts latest ethanol directive, and to that extent, the stronger sugar companies will come back because otherwise many of the companies will go into deep losses. They will not be able to pay farmers and the entire equation for the government will also go for a toss. So wait and watch.”
“Even though the ethanol volumes are going to take a hit for sugar companies, the margins may not be that impacted as it would be on the top line. So far, B and C-heavy ethanol, the margins could be between 27% and 30%. For juice-ethanol, it will be 15- 20%.”
Among the top losers from sugar sector were Shree Renuka Sugars which plunged over 7% in the opening trade amid high volumes, followed by Balrampur Chini, Rana Sugar, The Ugar Sugar Works and Dwarikesh Sugar, which lost up to 3%.
Mukesh Ambani, Chairman of Reliance Industries Ltd. (RIL), is exploring a fresh avenue in the energy sector by targeting an underexplored resource: sugarcane press mud for compressed biogas (CBG) production. RIL is engaging with sugar mills to procure press mud, signaling a move towards biogas amid the push for green energy.