Best Ethanol Stocks In India

Ethanol is a renewable fuel derived from the fermentation of sugarcane juice. The government has been extensively promoting ethanol generation in recent years by incentivizing sugar mills. As a result, the ethanol business is thriving, making ethanol stocks an excellent investment in 2023.

In October 2021, the government urged Indian sugar businesses to direct excess sugarcane production towards the manufacturing of ethanol. This might be advantageous on two levels: first, ethanol can be blended with petrol, which can then be utilised as fuel, and second, it will solve the country's excess sugarcane production.

How will the Government’s push for ethanol-based fuel boost the Ethanol Industry?

The government took this move to cut imports of petroleum products, which are now at 85%, and automobile manufacturers are encouraged to build flex vehicles that can run on both ethanol-based fuel and petrol. This government project is in line with their efforts to reduce carbon emissions by one billion tonnes by 2030.

Given predicted vehicle population expansion and forecast demand for ethanol-based fuel in addition to petrol, the volume of ethanol required is expected to increase significantly in the coming years, which will certainly benefit the ethanol sector.

Top Ethanol stocks in India to look out for in 2023

The following are some of India's biggest sugar firms that could become major players in the expanding market of ethanol mixed eco-friendly gasoline. Ethanol stocks in India are excellent long-term investments.

1). Shree Renuka sugars

The Maharashtra-based corporation is one of India's top sugar producers, with the brand "Madhur" accounting for around 32% of the sugar industry.

They are one of the largest sugar producers, with an integrated business model and an existing ethanol blending capacity of 920 Kilo Litre Per Day (KLPD), which they plan to increase to 1400 KLPD by 2025. They also possess KBK Chemical-Engineering (100% subsidiary), which provides turnkey distillery, ethanol, and bio-fuel plant solutions.

2). Balrampur Chini Mills

Based in Uttar Pradesh, they are one of India's top sugar producers. Because to its strategic expansion projects and well-planned purchase of competitors, it has become one of the most efficient sugar producers in the country.

The sugar business accounts for approximately 82% of the company's revenue and is primarily involved in the production of alcohol and ethanol.

3). EID Parry (India) Limited

Parry is India's oldest sugar company, having been in existence for nearly 225 years. It is a subsidiary of the Murugappa Group, with offices in Tamil Nadu, Karnataka, and Andhra Pradesh.

It owns Coromandel International, one of India's biggest fertiliser companies. The company specialises in creating highly specific sugars for specialised applications.

4). Triveni Engineering and Industries Limited

Based in Uttar Pradesh, it is a conglomerate that operates in agricultural (sugar, alcohol, and power co-generation) and engineering (water and wastewater treatment systems, power transmission, and defence).

The company is one of the largest local sugar manufacturers, with a total capacity of 61,000 TCD, power co-generation of 104.5 MW, and distillery capacity of 660 KLPD split over seven locations in UP. It now has a distillery capacity of 660 KLPD, up from 320 KLPD last year.

5). Dalmia Bharat Sugar and Industries Limited

It is situated in Uttar Pradesh and is part of the Dalmia Bharat Group. The company's major business is the production of sugar and industrial alcohol, as well as the generating of electricity.

It is also a favourite sugar supplier to institutional behemoths such as Coca-Cola, PepsiCo, Mondelez, Perfetti, Britannia, and a slew of other alcohol conglomerates such as United Breweries. Sugar sales account for 72% of total income at the corporation.