Shares of Shree Renuka Sugars (SRSL) have moved 7 per cent higher to Rs 60.90 on the BSE in Thursday’s intra-day trade on the back of heavy volumes.
The stock of the sweetener was trading higher for the third straight day, having rallied 24 per cent during this period. It was close to its 52-week high level of Rs 63.25 touched on April 25, 2022. The average trading volumes on the counter more-than-doubled with a combined 69.04 million shares having changed hands on the counter on the NSE and BSE.
Shree Renuka Sugars is a major agricultural and biofuels company in India. The company is one of the world’s largest sugar producers, and one of the world’s largest sugar refiners.
The board of directors of Wilmar Sugar Holdings Pte. Ltd.,(Holding Company) has provided letter of support to the company to meet shortfall in its normal trade related working capital requirements for up to a period ending May 31, 2023.
Also, term loans and working capital loans availed by the company from banks are secured by corporate guarantee provided by the ultimate promoter company (Wilmar International Limited).
Meanwhile, Shree Renuka Sugars on September 16 had informed stock exchanges that the expanded capacity for ethanol production from 720 KLPD to 1250 KLPD is expected to go on stream by December 2022.
To manage the sugar inventory levels and reduce the country’s oil import bill, the government advanced the timeline for 20 per cent ethanol blending in petrol to 2025 from the earlier target of 2030. Given the current blending rate of about 10 per cent, the target presents a huge demand potential; and given the supply deficit position, the government has been incentivising the segment by increasing prices and subsidised loans.
Rating agency India Ratings & Research (Ind-Ra) has reaffirmed its rating on the long‐term bank facilities availed by SRSL and non‐convertible debentures (NCD) issued by the company.
Ind-Ra continues to factor in SRSL’s strong legal, operational and strategic linkages with its ultimate parent, Wilmar International Limited (Wilmar), and the continued strong support that it receives from Wilmar to arrive at the ratings.
The positive outlook reflects the likelihood of a sustained improvement in SRSL’s business profile with the doubling of its distillery capacity along with the likelihood of a gradual deleveraging with the ramp-up of the new capacities leading to an improvement in the financial profile, Ind-Ra said on August 18, 2022.
Wilmar is a leading global branded consumer pack oil, specialty fat and oleochemical producer and edible oil refiner. It is also a leading producer of consumer pack edible oils and a leading sugar miller and refiner in India.