Sugar stocks have been on a roll in recent months, especially after the government brought forward the date for achieving 20% ethanol-blending with petrol by five years, from 2030 to 2025. This move is expected to reduce oil dependence and pollution.
Shree Renuka Sugars Ltd. (NS:) has seen a massive rise in its stock price, moving up 116% in June from Rs 15.75 to Rs 34.05. The company reported its numbers for Q4 FY21. It reported a net loss of Rs 44 crore for the quarter ended March 31, 2021 compared to Rs 146 crore in the March 2020 quarter. Sales fell almost 8% to Rs 1,320.4 for the quarter compared to Rs 1,431.9 crore in March 2020 quarter.
The company also said that it will invest Rs 450 crore into expanding its ethanol capacity to take advantage of the government ruling. In a regulatory filing, the company informed that its board has approved expanding production capacity by 430-kilo litres per day to 1,400-kilolitres per day.
“Considering the huge untapped demand for ethanol due to the policies of Government of India on ethanol blending, the Board of Directors of the company approved further capacity expansion for ethanol production from 970-kilo litre per day to 1,400-kilolitre per day,” the filing said.
(The above news was originally posted on in.investing.com by By Aditya Raghunath)