Sugar Stocks Tank Amid Worries Over Export Ban; 3 Stocks That Hit Lower Circuit

  • Stock Market Analysis
  • Editors Pick

On Monday, the Indian stock market opened on a flat note with the selling pressure intensifying during the day. The benchmark Nifty 50 index plunged 0.69% to 16,103.55 by 2:30 PM IST, with most of the sectoral indices trading in the red zone. 

Although the market breadth is pointing to a firm bear’s grip in today’s session, sugar stocks are especially having a rough day. A news flash from Bloomberg reported that the government of India is looking to curb sugar exports from the country. The move comes after the government put a ban on the export of wheat .

Sugar stocks have gone for a rough ride amid the government’s decision to ban sugar export. Soon after the news break, some sugar stocks hit a lower circuit in today’s session. Let us have a look at three stocks that are showing more pain for investors.

Dhampur Sugar Mills

Dhampur Sugar Mills Ltd (NS: DAMS ) has been one of the worst-performing sugar stocks in the recent past. The stock has fallen over 56% from its 52-week high of INR 584.5, in a matter of just 31 trading sessions. 

Dhampur sugar

Image Description: Daily chart of Dhampur Sugar Mills, depicting a support level

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The stock has fallen almost vertically in the recent sessions, accompanied by increasing volume. As of 2:55 PM IST, Dhampur Sugar shares were trading at a lower circuit, at INR 252.25, almost an inch away from the 52-week low of 251.2. Below the 52-week low, the next support level seems to be around INR 210 - INR 208.

Ugar Sugar Works

Another sugar stock that hit a 5% lower circuit in today’s session is Ugar Sugar Works Ltd (NS: UGSW ) which tanked to INR 55.2 by, 2:55 PM IST.  From a 52-week high of INR 86.75, the stock tanked over one-third and still not showing any signs of a reversal.

Ugar Sugar

Image Description: Daily chart of Ugar Sugar Works, depicting two support levels

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Currently, the nearest support seems to be around INR 50, from where the stock reversed a few days back. Below this support, the fall might continue for another INR 10 till the next support level of INR 40. 

Bajaj Hindustan Sugar

Shares of Bajaj Hindustan Ltd. (NS: BJHN ) also plunge to a lower circuit of 5%, currently trading at INR 14.35, by 2:55 PM IST. The stock has been trading in a sideways trend for a long time, testing investors’ patience since June last year.

Bajaj Hindustan Sugar

Image Description: Daily chart of Bajaj Hindustan Sugar, depicting a head and shoulders pattern

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However, now the stock is forming a Hear and Shoulders chart pattern and is currently in the last leg of completing the right shoulder. The neckline around INR 14 remains the nearest support for the stock, below which investors might see increased selling pressure.

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