Balrampur Chini, Renuka Sugars, Triveni Eng & More; Ethanol & Sugar Stocks Rally After Excise Duty Cut; Why

Major ethanol and sugar stocks rallied on June 11th after the government removed excise duty on petrol with higher blended ethanol such as E22, E25, E27 and E30 fuel variants. Stocks like Bajaj Hindustan Sugar, Balrampur Chini Mills, Dalmia Bharat Sugar, Shree Renuka Sugars and Triveni Engineering, among others, traded on a bullish note. This is because these companies are leading producers of ethanol in India, and an excise duty cut is good news.

Ethanol & Sugar Stocks Rally:

Bajaj Hindustan Sugar, Balrampur Chini Mills and Dalmia Bharat Sugar surged by 1.5% to 2%. Meanwhile, Shree Renuka Sugars gained nearly 1%. However, Triveni Engineering stock zoomed by more than 2.5%, becoming the top performer.

These companies are leading producers of ethanol in India. The latest announcement of removing excise duty on petrol blended with higher ethanol such as E22, E25, E27 and E30 fuel.

This is expected to increase demand for higher ethanol-blended fuels, which will further increase production capacity for such companies. This in return will fuel their profitability growth.

Excise Duty Cut On Ethanol Fuel:

As per the latest reports, the government has removed excise duty on petrol blended with higher ethanol. For instance, petrol containing 22% to 30% of ethanol will be exempted from excise duty. These include ethanol fuel variants like E22, E25, E27 and E30.

These four fuel ethanol variants have recently received the Bureau of Indian Standards (BIS) hallmarking of IS 19850.

This major decision comes after India achieved its E20 ethanol blending target ahead of 2025-26, and during series of hikes in regular petrol and diesel prices.

According to Dr. Manoranjan Sharma, Chief Economist, Infomerics Valuation and Ratings, India's EBP has progressed rapidly over the past decade, culminating in the achievement of 20% ethanol blending in petrol (E20), significantly ahead of the original timeline of 2025-26.

Furthermore, the expert highlighted that rising geopolitical tensions around the Strait of Hormuz, a critical artery through which nearly 20-30% of the world's traded crude oil passes is following recent scuffles involving Israel and the United States have once again pushed global crude prices upward, highlighting the fragility of international energy supply chains.

For India, he said, this situation opens a window of opportunity to cushion the impact of crude shocks by strengthening its domestic ethanol ecosystem and focusing inward. Higher global crude prices often encourage major producers to divert a larger share of sugarcane toward ethanol production at the expense of sugar, which could tighten global sugar supplies and improve the prospects for Indian sugar exports.