Sugar stocks rose by up to 7 per cent today amid reports that the government is likely to announce a bailout package of over Rs 7,000 crore to ensure cash-starved mills clear dues to farmers at the earliest.
Shares of Dhampur Sugar Mills soared 6.62 per cent, Avadh Sugar & Energy (6.55 per cent), Mawana Sugars (6.54 per cent), Balrampur Chini Mills (6.28 per cent), Bajaj Hindusthan Sugar (5.79 per cent) and Uttam Sugar Mills (5.79 per cent) on BSE.
Concerned over mounting cane arrears of more than Rs 22,000 crore, the government is likely to announce a bailout package of over Rs 7,000 crore to ensure cash-starved mills clear dues to farmers at the earliest, sources said yesterday.
A decision in this regard is expected to be taken in the meeting of the Cabinet Committee on Economic Affairs (CCEA) on June 6, the sources added.
Sugar mills are unable to make payments to cane growers as their financial health has worsened due to a sharp fall in sugar prices after a record production of 31.6 million tonne (MT) so far in the 2017-18 season (October-September).