Sugar stocks surge as Centre announces a bailout package of Rs 7000 crore
A labourer stands next to a mechanical harvester in a sugarcane field
Uttam Sugar Mills Ltd, Magadh Sugar & Energy Ltd and Dalmia Bharat Sugar and Industries Ltd rose 4 percent each
Shares ofIndiansugarcompanies rose on Tuesday followingreportsthat the federal government would announce a bailout package of over 70 billion rupees ($1.04 billion) for cash-starvedsugarmills to help clear dues to farmers.
DhampurSugarMills Ltd and MawanaSugars Ltd gained 7 per cent each, while Balrampur Chini Mills Ltd and AvadhSugar& Energy Ltd climbed more than 6 per cent each.
UttamSugarMills Ltd, MagadhSugar& Energy Ltd and Dalmia BharatSugarand Industries Ltd rose 4 per cent each.
The Cabinet Committee on Economic Affairs is scheduled to meet on Tuesday to decide on the bailout, according to the report.
Reuters reported late last month, citing official sources, that the government would soon approve a plan to create "bufferstocks" of 3 million tonnes ofsugarto prune surplus in the domestic market and stem a free fall in prices.