Sugar Cycles: 7-8 years of losses followed by 2-3 years of super gains!

Bumper result by Dwarkesh. Deferred Tax provisioning has dented PAT. Yearly EPS jumped 4 times. Yesterday fall may be due to general mkt sentiment and falling US futures. Ripe for re rating.

But sir, dwarkesh today lost 14 points since opening. this good result is not accepted by market. why?

Mkt appears to be hesitant to believe the sustainability of sugar story. Dwarkesh carries an inventory 18L quintals. Sooner or later mkt will realise the potential. Confidant of good results for next 2 qtrs.

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Been through few Calls of Sugar Industries
Overall the feeling is this year there will be production of around 20.x mil , next season 24-25mil , with Maharashtra also contributing . They expect prices to be stable around 35-37 kg for FY18 as well.
No chance of import as well , Supply may meet demand unless rainfall plays truant.
Companies have stock ranging from 20-30 lac Quintals , booked at around 27-30 /kg and realization of around 36/ kg . so this will drive the profits going forward.

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What are your opinions on Ugar Sugar results?

Why Balrampur chini is falling in last 1 week despite being fundamentally strong company?
in last 3 days, it fell 8%
Seniors please provide your views.

Thanks :slight_smile:

It seems weak international prices are having a sobering effect but expectations of good monsoon should restrict imports and allow sugar companies to enjoy steady prices till oct 2017. H k gupta

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Ace invester again bought 38.1 Lac Dhampur sugar shares @Rs 181.4/- He is continuously adding as and when opportunity arising. His cumulative holding now increased to over 6%. Golden UP trio (Balram/Dhampur/Dwarkesh) have posted excellent results. Their carry over inventory as on 31st mar 2017 stands at 61Lac Quintal, 39Lac Q, 18L quintals respectively. This iteself assures a decent mumbers in coming Qtrs. Anticipating good monsoon and production ramp up in Mahrastra/Karnataka, prices may moderate in H2 Fy18. In any event Ex mill price may not fall below 35/- for next 3 qtrs which provides the UP mills to post good numbers.I am invested and adding on dips .

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True that , But sugar being cyclical sector , market will never give them higher pe multiples.
UP based Companies will continue to post profit in medium term for 4 qtrs atleast . Mr Sarogi , during the conc call indicated that he is very postive about the structural changes that govt is bringing about in the sector as state & centre being on same page now , and who knows in future may allow export as well , he remained bullish on medium-long terms , especially on UP based companies . he also commented on water table levels better that South.however any major re-rating can happen with policy changes , till then the scripts will be oscillate , thats my opinion.

Friendly note: Purchase was 3.81L Shares not 38.1L Shares :slight_smile:

I stand corrected n thanks for the info. I will be careful in future. Nevertheless, irrespective of the qty, it bolsters the sentiment.

Mr Anil Kumar Goel has acquired 16.54 L shares of Dhampur sugar in the past 5 months ending May 31,2017.He along with his family holds 10.28%.
http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/228bcc75-155d-4535-b7c5-48a1e32f74a2.pdf

why there is so much of weakness in this sector?
is this due to drop in global sugar prices? are there any further chances of duty free import of sugar?

Balrampur chini is falling since posting results.
Some analysts are saying, sugar stocks already had a good run, so not much fuel left.
balram has stopped below 30 day moving average.
It is not getting enough support at that price point.

the 150 day moving average for balram is 142. if it breaches this level, then it is a serious problem for the investor!
I am not tracking other sugar stocks!
I am also looking for possible explanations.
Seniors please advice.

Can anyone help me for Chart of international prices of Sugar for last 12 months. I am trying to analyze the price trend. Please help. links to any website or blog will aslo help. please give leads

Pls check if this site can help you…

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Dhampur suagr…weekly chart shows the stock is very interestingly poised. The momentum indicator shows that there may be a bounce in the stock price. It remains to be seen as to how high the stock goes in that bounce. If the bounce fizzles out in a short time then the break of the trendline support should be used as an exit signal.

On the other had if the stock rallies and gains strength, then the upper channel line (in blue) can be used to book profits in Dhampur.

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Is anybody aware about a joint venture between Dhampur sugar and Autolite india for manufacturing Lithium-ion batteries. This can rerate the stock. Dhampur sugar holds 30% in the JV. http://auto.economictimes.indiatimes.com/news/commercial-vehicle/lcv/autolite-enters-e-rickshaw-space-to-grow-lithium-ion-battery-business/58360355

webpage of Highstreetlighting.in, connected to your query sir.
http://highstreetlighting.in/index.php?route=information/information&information_id=9

Friends sugar super cycle seems to be over for now unless some new fundamental support emerge. In terms of fundamentals all indicators are in negative side: (1) Good monsoon points to better production of sugar at all India basis which can easily exceed demand of around 25 million tonne per annum. (2) Now general election is due in 2019 and all political parties may likely to increase FRP and SAP etc of sugarcane in upcoming season at even higher level than what is currently available. (3) Prices of most agriculture commodities is under pressure and same trend can get reflected for sugar from coming season (4) Petroleum prices are also under pressure and likely to continue in the range for next 2-3 years which can cap prices of ethanol in brazil and so favor mix of sugar production than ethanol. Based on these fundamentals significant correction in sugar stocks can not be ruled out in upcoming months.
Disc : Don’t hold any sugar stock currently neither have any plan for the same in near future

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