Archive · 1 Sep 2026
DAM Capital Favors Three Sugar Stocks Amid Tight Supplies
India does not have as much sugar as usual.
Sugar prices rose sharply between June and August 2026 before the government took steps to control them.
The government allowed duty-free imports and introduced rules to stop stockpiling.
DAM Capital expects supplies to stay tight until more imported sugar arrives.
It also expects the next sugar crop to be smaller because of weather problems and weaker sugarcane varieties.
The brokerage believes ethanol production may need to use more grain because sugarcane should mainly be used to make sugar.
It favors Triveni Engineering because much of its distillery capacity can switch to grain.
It also expects Dalmia Bharat Sugar and Balrampur Chini to benefit from higher sugar prices and company-specific advantages.
DAM Capital expects sugar prices to remain elevated as India faces tight supplies and low opening stocks.
India may need 20 lakh tonnes of imports, with the brokerage expecting arrivals by March 2027.
The brokerage projects SS27 sugar production at around 2.9 crore tonnes after weather and crop setbacks.
Triveni Engineering received a Buy rating with a target price of Rs 415.
Dalmia Bharat Sugar and Balrampur Chini received Buy ratings with targets of Rs 710 and Rs 825, respectively.
- Who
- DAM Capital and the sugar companies Balrampur Chini, Dalmia Bharat Sugar and Triveni Engineering.
- What
- DAM Capital issued Buy recommendations and target prices for three sugar stocks amid expectations of prolonged tight supplies.
- When
- The analysis covers sugar prices from June through August 2026, the season beginning October 1, and forecasts for FY27 and FY28.
- Where
- India, with supply conditions discussed in Maharashtra, Uttar Pradesh and the wider domestic sugar market.
- Why
- Repeated weather setbacks, weaker sugarcane yields, low opening inventories and limited near-term production are expected to keep sugar supplies tight.
- Sugar price movement
- Domestic sugar prices rose from Rs 38-41 per kg in June 2026 to Rs 52-55 per kg by the end of August; ex-factory prices briefly reached Rs 68 per kg.
- Government response
- The government announced 10 lakh tonnes of duty-free imports, a 15-day stockholding cap for bulk buyers and anti-hoarding action.
- Opening stocks
- India is expected to enter the new season with 30 lakh tonnes of sugar, equivalent to about 35 days of consumption and described as the lowest level in a decade.
- Import requirement
- DAM Capital estimates that India needs 20 lakh tonnes of imports, which it expects to arrive by March 2027.
- Triveni Engineering
- Buy rating; target price Rs 415; FY27 operating profit is expected to rise 79.5% to Rs 730 crore.
- Dalmia Bharat Sugar
- Buy rating; target price Rs 710; FY27 operating profit is projected to rise 54.6% to Rs 660 crore.
- Balrampur Chini
- Buy rating; target price Rs 825; FY27 EBITDA growth is projected at 53.6%.