Sugar stocks fell between 2-10 per cent on Friday following the announcement of a 20 per cent export duty on sugar to boost domestic supply and check prices.
Bajaj Hindustan shares fell 4.8 per cent, Oudh Sugar slumped 10 per cent, while Ponni Sugars and Shree Renuka Sugars fell 8.6 per cent and 4.6 per cent respectively.
The export duty is aimed to boost supply of sugar in domestic markets, where prices have moved up from Rs 30/kilogram six months ago to Rs 40/kilogram.
The duty will help restrict sugar exports, which had gained pace, following a sharp rise in global prices. With imposition of export duty, sugar exports will be unviable and is likely to restrict exports, government officials said.
Industry experts however said that the export duty is unlikely to put a check on domestic prices.
“We don’t think it will have any impact. India is not a regular exporter of sugar, we export only if there is surplus,” M Manickam, vice chairman and managing director at Sakthi Sugars, told NDTV Profit.