I have Reworked SOTP of key sugar companies post recent rally – Balrampur and Dalmia Sugar discount has come down significantly but Dwarikesh and Dhampur still provides some headroom there. Just to highlight, Replacement cost might also go up as market will start paying premium to earlier price given the attractiveness of the sector. I have not revised replacement cost, any upside revision will increase the discount.
But few days back i was checking 10 year seasonality chart of global sugar prices which suggests that any 3-4 month of rally in sugar price is followed by prolonged correction…will try to update that chart…so i feel the recent rally in sugar price will wane off in 1-2 months time…once that correction starts reflecting in sugar prices then we will see some correction in these stocks which ran up too fast too soon…i might be wrong but such a rally in short span is irrational….
| Subscribe To Our Free Newsletter |
