Since then while the Sensex has moved up by about 1.5% as of yesterday, the total market-cap of top 20 sugar stocks fell by about 35%. This crash in the sugar stocks has to do with bumper sugar output anticipated and consequent steep fall in the sugar prices in both the domestic and global markets. In the domestic markets, several small-cap sugar stocks have fallen even over 65%. Burst in sugar stocks is a good source of learning for the retail investors how not to chase the stocks at their peaks without understanding the cyclical nature of the business and valuation. However, diversified sugar producers and exclusive sugar producers with least dependence on the debt are the stocks worth to accumulate in the current meltdown for the medium to long-term wealth creation, though the bitter taste of sugar stocks is expected to continue in the short-term.

Source: dna March 20, 2018 00:11 UTC