Shares of Indian sugar and ethanol-linked companies rallied sharply on Monday, bucking the broader market trend, as rising global crude oil prices boosted optimism about higher ethanol demand, Newsbytes reported.
Stocks of several sugar companies gained between 3% and 10% during the session, with Dwarikesh Sugar Industries leading the rally after its shares jumped about 8.5%, at around 2 pm.
Other major gainers included Dalmia Bharat Sugar and Industries, which rose 7.7%, and Dhampur Sugar Mills, which climbed 7.5%. Shares of Bajaj Hindusthan Sugar gained 6.8%, while Uttam Sugar Mills advanced 6.2%.
Among other notable performers were Praj Industries, which rose about 6%, Shree Renuka Sugars, up 4.8%, and Balrampur Chini Mills, which gained 3.5%.
The rally was triggered by a sharp rise in global crude oil prices amid escalating tensions linked to the US-Israel-Iran conflict in West Asia. On March 9, Brent crude climbed to around $119.50 per barrel, while West Texas Intermediate (WTI) briefly touched $119.48 per barrel.
Higher oil prices typically make Ethanol production more economically attractive, prompting sugar mills to divert more sugarcane toward biofuel manufacturing rather than sugar output. This shift often improves profitability prospects for companies in the sector.
India has been steadily expanding ethanol production under its fuel blending programme aimed at reducing dependence on crude oil imports and lowering carbon emissions.
Under the policy, oil marketing companies are required to blend ethanol with petrol before selling it in the market. The programme also supports farmers by boosting demand for crops such as sugarcane and maize while strengthening the country’s biofuel ecosystem.
