Sugarcane Turning Into Prominent Energy Crop: ICICI Direct
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ICICI Direct Report
We initiated coverage on the sugar sector on the premise of rationalising sugar inventory levels in the country and possibility of significant sugarcane diversion toward producing ethanol.
Our view is materialising given sugar inventory levels are coming down from the peak of 14.5 million tonne in September 2019 to approximately eight million tonne in September 2021.
Further, in the current sugar season, the industry would be diverting (sacrificing) two million tonne of sugar for ethanol production.
With the government’s aggressive stance on increasing ethanol blending with petrol to levels of 20% by 2025, the industry is undertaking huge capacity expansion programmes to meet the ethanol requirement of 10 billion litre by 2025.
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