Sugar mills that have been classified as Non Performing Assets (NPA) by their lender can also avail the government's newly announced interest-free loans scheme if the concerned state governments give guarantee for their new loans, an official statement has declared.
The cabinet committee on economic affairs (CCEA) on Thursday endorsed a plan to offer interest-free loans worth Rs 6,600 crore to ailing sugar mills.
India's Rs 80,000-crore sugar industry will now be managed by market forces, thanks to the government's major decision to decontrol the industry.
The Government on Thursday abolished the monthly release mechanism and freed sugar mills from the obligation to supply levy sugar at subsidised rate for the Public Distribution System (PDS).
Abinash Verma, director-general of the Indian Sugar Mills Association, said that the decision would help the industry reach its potential growth of 20-25 per cent per annum.
Balrampur Chini Mills one of the giant sugar manufacturers has announced to buy back its shares. Managing Director of Balrampur Chini Mr. Vivek Saraogi has spoken to CNBC –TV 18 about this buyback offer. He also informed that the company will get Rs. 4000 crore from this offer.
The price will be decided soon. It is expected that the price will not exceed Rs. 85 for this buy back. Company will use 1100 million free reserves to buy back through exchange.
Balrampur Chini had underperformed since last one quarter. The shares have fallen by 5.62% as Sensex declined by 2.99%.
For the first time, after a long gap of three years, India considers that the supply of sugar shall supersede the demand. India government, just a week ago, has also resumed the futures trading of Sugar on the MCX that opened with a bang and indicated future price rise.
The trading had been banned earlier for the control of rising prices of sugar. All the contracts were trading at a premium price.
A no trade scenario for almost 19 months the sugar futures is quite a long period for a ban. Since May 2009, when the price of sugar went high, the ban on sugar contracts was enforced. Rs. 100-300 crore was the volume of daily turnover for sugar contracts before the government imposed a ban on the trade.
According to the farm minister, this crop season India is expecting a sturdy ricochet in the farm production that shall considerably curtail food price inclination that has mounted since last year when the nation's worst famine in 37 years had stroked the crops.
This year's June-September month monsoon was 16 per cent lower than the standard of the last month, however the rainfall has invigorated considerably, soothing out the fears of scarcity and inclining prices.
Singapore base agribusiness group Wilmar International Ltd. has informed that it has decided to buy Australian conglomerate CSR Ltd.'s sugar and renewable energy industry, Sucrogen. It has also represented the financial details of this deal.
As per Wilmar International, it will purchase the CSR's sugar Unit for $1.48 billion. Wilmar's offer price includes 1.35 billion Australian dollar in shares and 403 million in net balance. Sucrogen is the biggest Australian raw sugar manufacturer and the second biggest exporter globally.
It appears like yet another British company will be bought over by a foreign firm, as news reports of Tate & Lyle’s sell out hit news stands. This is the most recent sell out after Kraft took Cadbury just months ago. This sale does fuel fears of the future of large firms in the UK as one follows the other to rival shores.
An agreement to have a majority stake in Brazilian Equipav SA Acucar e Alcool has been signed by Shree Renuka sugars which amounts to Rs. 1,151 crore, a priced lowered by 25% than the earlier price.
The largest sugar refiner, Shree Renuka will go for an acquisition of 50.3% stake in Equipav. Equipav has a cane crushing capacity of 10.5 million tonnes per year and they have ownership of 1, 15,000 hectares of land. The transaction is expected to close in two weeks time.