List Of Best Ethanol Stocks in India 2024
Fuel is an essential product to keep the wheels of the economy running. I’m sure you’re wondering if there’s a substitute for gasoline or diesel. Therefore, the answer to your query is yes—blending ethanol with petrol and diesel can lower their prices and reduce the consumption of fossil fuels.
In this blog post, we will present you with a quick rundown of the leading Indian enterprises that produce ethanol.
Overview of the Ethanol Industry
One form of alcoholic beverage that is now utilized as a biofuel is ethanol. Typically, biomass sources like sugarcane, corn, and other plant components are used to make it. Ethanol burns cleaner and emits less dangerous pollutants when compared to other fuel types. This helps to improve air quality and reduce pollution. Typically, nations use their crops to make ethanol to lessen their dependence on fossil fuels. In India, the majority of ethanol-producing enterprises also produce ethanol as a byproduct. The Indian ethanol market stands at around 3200 million liters and is expected to grow at 5.67% CAGR until 2035.
Top Ethanol Stocks Based on Market Capitalization
The top ethanol stocks in 2024 are:
| S.No. | Ethanol Stocks |
|---|---|
| 1 | EID Parry (India) Limited |
| 2 | Shree Renuka Sugars Limited |
| 3 | Balrampur Chini Mills |
| 4 | Triveni Engineering and Industries Limited |
| 5 | Bajaj Hindusthan Sugar Limited |
The ethanol stocks have been listed in descending order based on their market capitalization in the table below:
| Company | Market Capitalization (In crores) | Share Prices (In INR) | 52 Week High Price | 52-Week Low Price |
| EID Parry (India) Limited | 13,850 | 780 | 833 | 453 |
| Shree Renuka Sugars Limited | 10,847 | 51 | 57.2 | 36.6 |
| Balrampur Chini Mills | 9,307 | 461 | 486 | 343 |
| Triveni Engineering and Industries Limited | 8,964 | 410 | 435 | 266 |
| Bajaj Hindusthan Sugar Limited | 5,535 | 43.3 | 45 | 15.9 |
Best Ethanol Stocks in India 2024 – An Overview
The best ethanol stocks in India are given below, along with a brief overview:
1. EID Parry (India) Ltd.
The company is in the nutraceutical and sweetener business. British trader Thomas Parry created the company in 1788, and in 1842, it opened its first sugar refinery in Nellikuppam, Chennai. In 1981, the Murugappa group took over the EID Parry. With a capacity to crush 40,000 tonnes of cane daily, the firm now runs six sugar factories. The company wishes to invest INR 286 crore to boost ethanol production.
2. Shree Renuka Sugars Ltd.
In 1998, Narendra Murkumbi and his mother, Vidya Murkumbi, formed the business. The business can process 46,000 tons of material daily and has a sugar refining capacity of 1.7 million tons. At Kandla on the western shore and Haldia on the eastern coast, they proudly operate two of the biggest sugar refineries in the world. The firm, which has a daily production of 1250 kilolitres of ethanol, is one of India’s leading ethanol producers.
3. Balrampur Chini Mills Ltd.
It is one of the largest sugar manufacturing companies in India. It was established in 1975 and has its headquarters in Kolkata, West Bengal. The company’s business includes the production of ethanol and sugar, and it also produces biogases as a byproduct of sugarcane processing. The company has 10 sugar plants in Uttar Pradesh. The company has an ethanol production capacity of 1050 kiloliters per day.
4. Triveni Engineering and Industries Limited
The company was founded in 1932 as a small sugar factory in Uttar Pradesh. Initially, the company was named Ganga Sugar Corporation Limited, and finally, in 2000, the company changed its name to Triveni Engineering and Industries Limited. Currently, the company is the second-largest sugar producer in India. The company has a diverse product portfolio and is engaged in the engineering sector, high-speed gears and gearboxes, alcohol, power transmission business, and water business. The company has its headquarters in Noida. The company has invested INR 350 crore to increase its ethanol production capacity from 320 to 660 kiloliters per day.
5. Bajaj Hindusthan Sugar Limited
It is India’s largest sugar manufacturing company, established in 1931 by Jamnalal Bajaj in Lakhimpur Kheri, Uttar Pradesh. In 1967, it was incorporated as Hindusthan Sugar Mills Limited and later changed its name to Bajaj Hindusthan Limited in 1988. Currently, the company has an ethanol production capacity of 800 kilolitres per day and its headquarters in Maharashtra.
Comparative Study of Ethanol Stocks
Performance of Ethanol Stocks
| Company | 6 Months Return (%) | 1 Year Return (%) |
| EID Parry (India) Limited | 24.24% | 56.42% |
| Shree Renuka Sugars Limited | 7.86% | 9.6 % |
| Balrampur Chini Mills | 17.52 % | 16.42 % |
| Triveni Engineering and Industries Limited | 23.49 % | 34.77 % |
| Bajaj Hindusthan Sugar Limited | 40.85% | 134.62 % |
Key Performance Indicators
| Company | Net Profit Margin (%) | ROCE (%) | P/E ratio (x) | P/B ratio (x) |
| EID Parry (India) Limited | 5.59 | 20.54 | 15.39 | 1.71 |
| Shree Renuka Sugars Limited | -5.54 | 20.9 | -17.04 | -7.43 |
| Balrampur Chini Mills | 9.08 | 20.16 | 17.41 | 3.4 |
| Triveni Engineering and Industries Limited | 7.56 | 17.57 | 22.69 | 5.18 |
| Bajaj Hindusthan Sugar Limited | -1.42 | 0.7 | -63.72 | 2.45 |
Benefits of Investing in Ethanol Stocks
You may benefit from investing in ethanol stocks because of the following reasons:
- Government Incentive – India is providing incentives for the ethanol industry because it wants to lessen its reliance on fossil fuels and protect the environment.
- Increase in Oil Prices – Ethanol stocks are viewed as a hedge against rising oil prices since demand for ethanol will rise in response to higher traditional oil prices.
- Growing Demand – People are becoming increasingly aware of climate change, which is driving up demand for cleaner energy sources.
Factors to consider before investing in Ethanol Stocks
When choosing to invest in ethanol stocks, several considerations must be made. A few of these are included below:
- Financial Health – This is regarded as the most crucial element when investing in ethanol stocks; an investor must carefully review the financial statements of a company.
- Competition – Because the ethanol market is expanding so quickly, it draws in new, well-established competitors, increasing competition and reducing profit margins.
- Regulatory Risks – The government is now focusing on this sector; therefore, any stringent rules will have an effect on the company’s operations and profits.
Future of the Ethanol Sector in India
The Indian ethanol industry has grown exponentially in the past few years, as the government mandated blending with automobile fuels. Initially, blending was done at just 1.5% from 2005 to 2014; later, it was increased to 10% during 2014 – 22, and the government has set a target of 20% blending from 2025. So, the future of the ethanol sector in India is very bright.
Conclusion
On a concluding note, ethanol being considered as an alternative fuel makes this sector attractive. However, various factors can directly impact the performance of this sector, such as commodity prices and government policies. An investor should invest in this sector after conducting proper research about the companies. They need to stay updated about the regulatory changes in the industry and consult their investor advisor before investing.
Frequently Asked Questions (FAQs)
Is it worth investing in ethanol stocks?
These stocks have a promising future because of the increasing demand for clean energy and government incentives; however, proper research is required before investing.
How can government policies impact the performance of ethanol stocks?
Favorable government policies can increase the revenues and profits of ethanol companies and their share prices.
What are the factors to be considered while investing in ethanol stocks?
Various factors, such as demand for ethanol, regulatory changes made by the government, and the financial performance of companies engaged in ethanol production, could impact the performance of ethanol companies.
Which companies are engaged in the production of ethanol in India?
Various companies are engaged in ethanol production in India, such as EID Parry India Limited, Shree Renuka Sugar Limited, Balrampur Chini Mills, Triveni Engineering and Industries Limited, etc.
Is ethanol cheaper than petrol or diesel?
Yes, ethanol is comparatively cheaper than petrol and diesel.
