Systematix remains positive about the sugar sector

Leading brokerage firm Systematix Institutional Equities remains bullish on the sugar sector, expecting supportive government policies on ethanol production and pricing post-election.

The brokerage has issued buy ratings on several sugar stocks: Balrampur Chini (target price: ₹501), Triveni Engineering (target price: ₹421), Dwawarikesh Sugars (target price: ₹96) and Praj Industries (target price: ₹607). .

Systematix believes the government will remain committed to the 20% blending target, considering the ethanol policy change to be temporary. With ISMA’s revised sugar surplus estimate at 8.85 million tonnes, they expect restrictions on the use of relaxed juices and B-Heavy molasses in the coming season.

The brokerage predicts increased diversion of sugarcane towards ethanol production, which may exceed initial ethanol volume projections for 2025. Moreover, a favorable monsoon forecast may lead to a revival in sugarcane cultivation.