Best Ethanol Stocks in India 2024

Ethanol has been one of the top contributors to the renewable energy industry in recent times. The government has been pushing for higher ethanol blending in petrol, thereby reducing the use of fossil fuels and lowering pollution. Due to this increase in ethanol demand, it has become a very exciting opportunity for investors.

In the article, we will discuss the best ethanol stocks in India for 2024. Find out how top companies are positioned in this green energy space for exponential growth and offer some good opportunities for your portfolio. So let’s get started!

Ethanol Industry Overview

Now that we understand the ethanol stocks, let's dive deep into this industry's performance. Ethanol is derived from renewable plants like corn and sugarcane and has special importance in the field of sustainable energy. It is mainly used as an additive to gasoline to increase its efficiency and reduce emissions. Ethanol has a major application in alcoholic beverages and personal care products as well.

The Indian ethanol industry is rapidly growing and is encouraged by factors like initiatives taken by the government, rising demand for biofuels, and a massive push in the direction of sustainable energy. India recorded the highest-ever ethanol blending of 11.6% in the first quarter of the year 2023. The Indian ethanol market is valued at approximately USD 6.51 billion in 2023 and is projected to reach nearly USD 14.15 billion by the year 2029, rising at a CAGR of 9.16%. Maharashtra is the largest producer of ethanol, followed by Uttar Pradesh and Karnataka 

Moreover, the growing awareness about global warming and the requirement for other renewable energy sources increases demand for ethanol, as it reduces dependence on fossil fuels and hence lowers carbon emissions. thereby increasing the market potential.

List of Best Ethanol Stocks in India

Now that we've gone through the ethanol industry's performance, let's check out the list of best ethanol stocks in India, with their share prices updated as of August 3, 2024.

Note: These stocks are listed based on their market cap. and past financial performance. Please conduct a detailed analysis before investing. Metrics are recorded as of  Aug 02, 2024, and may vary daily.

Best Ethanol Stocks in India 2024 - Overview

1) EID Parry Ltd

E.I.D. Parry (India) Limited, incorporated in 1788 is the giant sweetener and nutraceutical industry. It is part of the INR 742 billion Murugappa Group. It operates six sugar plants and one standalone distillery across South India

It manufactures products such as Sugar, Supergrains, and nutraceuticals and has facilities such as sugar plants and distillery factories in locations such as Nellikuppam, Pugalur, Sivaganga, Sankili, Bagalkot, Haliyal and Ramdurga.

It established India's first sugar plant in Nellikuppam way back in 1842 and was also the first to begin a distillery in 1843. Today, E.I.D. Parry continues to lead and innovate in the sugar manufacturing sector.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 13,548 Cr

• Debt-to-Equity Ratio (DE): 1.25%

• P/E Ratio: 15.2

• Return on Equity (ROE): 13.50%

• Dividend Yield: 1.25%

• Current Market Price (CMP): Rs. 763

2) Praj Industries

Praj Industries Ltd. was established in 1983 to develop itself as a leading global technology and engineering company that provides sustainable solutions in bioenergy, water purification, process equipment, breweries, and wastewater treatment.

Praj Industries has a diversified market portfolio, including BioEnergy, Praj Hi-Purity Systems, Critical Process Equipment and Skids, as well as Wastewater Treatment and Brewery & Beverages.

The company has four manufacturing plants in India: Wada, Kandla Units I & II, and Sanaswadi. It has a dedicated, state-of-the-art manufacturing facility at Kandla Special Economic Zone in Gujarat, with workshops separate for carbon steel and stainless steel fabrication.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 12,748 Cr

• Debt-to-Equity Ratio (DE): 0.13

• P/E Ratio: 44.4

• Return on Equity (ROE): 23.30%

• Dividend Yield: 0.87%

• Current Market Price (CMP): Rs. 694

3) Balrampur Chini Mills Ltd

Balrampur Chini Mills Limited, incorporated in 1975, is the largest integrated sugar company in the country, with operations in distillery and power cogeneration. 

Their product mix includes molasses, alcohol, ethanol, bagasse, and power generation. The company has ten manufacturing plants situated in Eastern and Central Uttar Pradesh in regions like Balrampur, Babhnan, Tulsipur, Akbarpur, Gularia, Maizapur, Mankapur, Rauzagaon, Haidergarh, and Kumbhi. 

BCML, with an installed sugarcane crushing capacity of about 80,000 TCD per day, is one of the giants in the Indian sugar industry and has a huge manufacturing capacity and diversified product profile to match its position.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 9,861 Cr

• Debt-to-Equity Ratio (DE): 0.59

• P/E Ratio: 22.8

• Return on Equity (ROE): 13.80%

• Dividend Yield: 0.64%

• Current Market Price (CMP): Rs. 489

4) Triveni Engineering

Triveni Engineering and Industries Ltd. is an integrated and diversified conglomerate that operates in the sugar, ethanol, and engineering sectors. It has its operations within the sugarcane-rich western and central belt of Uttar Pradesh, thereby being one of the top three sugar manufacturers and the second-biggest ethanol supplier in the country.

Triveni has a diversified portfolio of products with premium quality multi-grade crystal, refined, and pharmaceutical-grade sugar. The company produces ethanol and Extra Neutral Alcohol (ENA). It also offers solutions for water treatment and has a strong power transmission business, wherein it manufactures multi-stage gear drives and planetary gearboxes. In the case of defense, it produces propulsion gearboxes, gas turbine generators, and steam turbines.

It has four alcohol-producing facilities with a capacity of 660 KLPD, and it also has seven certified sugar plants in Uttar Pradesh, combining a crushing capacity of 61,000 TCD.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 8,778 Cr

• Debt-to-Equity Ratio (DE): 0.49

• P/E Ratio: 24.5

• Return on Equity (ROE): 14.20%

• Dividend Yield: 0.85%

• Current Market Price (CMP): Rs. 401

5) Piccadilly Agro Industries Ltd. 

Piccadilly Sugar and Allied Industries Ltd. is a Public Limited Company incorporated in 1994. It is India's largest independent manufacturer and seller of malt spirits. The company manufactures ethanol, Extra Neutral Alcohol, CO2, and white crystal sugar.

Its vast product range includes white crystal sugar from sugarcane, rectified spirit, extra neutral alcohol from molasses, ethanol, and various liquors such as IMFL, PML, and country liquor.

It has a manufacturing unit at Hamjeri, Patiala, with an installed capacity of 2,500 TCD for sugar and 75 KLPD for RS/ENA. The company is upgrading its machinery and constructing an ethanol project at Patran in Punjab.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 8,273 Cr

• Debt-to-Equity Ratio (DE): 0.51

• P/E Ratio: 94.4

• Return on Equity (ROE): 30.70%

• Dividend Yield: 0.02%

• Current Market Price (CMP): Rs. 877

6) Bannari Amman Sugars Ltd

Bannari Amman Group was established in 1986 and is one of the largest industrial conglomerates in South India. It is involved in the manufacturing and trading of sugar, alcohol, liquor, and granite. Additionally, they are engaged in services like wind power and education.

Bannari Amman Sugars Limited is one of the largest sugar manufacturers. It has five sugar units, three in Tamil Nadu and two in Karnataka all are equipped with cogeneration plants. Apart from this, it has two distillery units and one granite processing unit in Tamil Nadu, as well as windmills in the southern part of Tamil Nadu.

The group has an overall installed cane crushing capacity of 23,700 TCD across all its five units. This 1986-established company had its first factory with a capacity of 1,250 TCD. If we talk about their revenue 77% comes through the sugar business, whereas others through by-products such as molasses, bagasse, and bioproducts.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 3,950 Cr

• Debt-to-Equity Ratio (DE): 0.29

• P/E Ratio: 25.9

• Return on Equity (ROE): 9.40%

• Dividend Yield: 0.40%

• Current Market Price (CMP): Rs. 3,150

7) Dalmia Bharat Sugar Industries Ltd

Dalmia Bharat Sugar & Industries is a frontline player in the sugar sector of the country. They are involved in sugar manufacturing, generation of power, industrial alcohol, and refractory products. 

It is the fastest-growing sugar company in the country, with operations located in UP and Maharashtra. They are known for excellence in plant operations and technological leadership. Dalmia Bharat supplies major brands like Coca-Cola, PepsiCo, and Britannia. It also exports to Indonesia, Malaysia, Bangladesh, Sri Lanka, and many other countries in the world.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 3,198 Cr

• Debt-to-Equity Ratio (DE): 0.49

• P/E Ratio: 13.3

• Return on Equity (ROE): 8.51%

• Dividend Yield: 1.25%

• Current Market Price (CMP): Rs. 395

8) Dhampur Sugars Mills Ltd

Dhampur Sugar Mills is an integrated sugarcane processing company based in India. The firm was established in the year 1933 and is known for its enterprising spirit and enthusiastic initiative in tapping the full potential of sugarcane. The wide portfolio of the company goes beyond sugar to renewable power, ethanol, alcohol, chemicals, and biofertilizers.

Dhampur's business segments include sugar and its by-products, ethyl acetate chemicals, ethanol, potable spirits, power cogeneration, as well as sales of petrol and agricultural products.

The company has significant manufacturing capabilities, including a 15,000 TCD sugar plant, a 78.5 MW cogeneration unit, and a 350 KLPD distillery in Dhampur. Additionally, the Rajpura facility features a 9,000 TCD sugar plant and a 48 MW cogeneration unit.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 1,383 Cr

• Debt-to-Equity Ratio (DE): 0.89

• P/E Ratio: 10.2

• Return on Equity (ROE): 12.50%

• Dividend Yield: 2.39%

• Current Market Price (CMP): Rs. 212

9) Dwarikesh Sugar Industries

Dwarikesh Sugar Industries Ltd. is a diversified industrial group based in Mumbai. They are engaged in the activities of sugar manufacturing, power cogeneration, and ethanol/industrial alcohol production. Their first plant having a capacity of 2,500 TCD was set up in Bijnor, Uttar Pradesh, and since then has been on the rapid growth track to be one of the major players in the sector of bioenergy.

The portfolio is filled with a range of items including sugar, ethanol, power, and sanitizers. Dwarikesh is famous for producing the finest grains of sugar and various allied products; its legacy stems from a tradition of excellence and innovation.

With an increased capacity of 140 KLPD at Dwarikesh Nagar, its strong position in the industry is further enhanced by the production of distillery-based rectified spirits, ethanol, extra-neutral alcohol, and sanitizers.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 1,360 Cr

• Debt-to-Equity Ratio (DE): 0.55

• P/E Ratio: 40.8

• Return on Equity (ROE): 10.70%

• Dividend Yield: 2.73%

• Current Market Price (CMP): Rs. 73.4

10) Avadh Sugars and Energy

Incorporated in March 2015, Avadh Sugar & Energy Ltd is engaged in the business of manufacturing and selling sugar and its by-products, spirits, ethanol, and power. The firm was set up to consolidate sugar units from Oudh Sugar Mills and Upper Ganges Sugar & Industries into a separate company.

It has four sugar mills in the state of Uttar Pradesh, Hargaon with a 10,000 TCD capacity, Seohara with 10,000 TCD, Rosa Sugar Works with 4,200 TCD, and New India Sugar Mills with 7,000 TCD making a total capacity of 31,200 TCD. In addition to this, the company operates two distilleries with a total capacity of 200 KLPD, and a cogeneration facility producing 74 MW of power.

Here is an overview of the company's fundamentals:

• Market Cap: Rs. 1,259 Cr

• Debt-to-Equity Ratio (DE): 1.28

• P/E Ratio: 9.8

• Return on Equity (ROE): 13.40%

• Dividend Yield: 1.57%

• Current Market Price (CMP): Rs. 629

What are Ethanol stocks?

Ethanol stocks are shares of companies that produce, distribute, sell, and process ethanol, which is a kind of biofuel extracted from plants like corn and sugarcane. Those working in growing the raw material all the way to the ones who process, pack, and transport ethanol are all part of these companies. Ethanol is mostly used as an additive with gasoline fuel to reduce gas emissions and enhance the efficiency of gasoline, ethanol is used in beverages, pharmaceuticals, and personal care products.

Investments in ethanol stocks are putting one's money into the renewable energy sector, which is on the rise due to growing environmental awareness and supporting policy frameworks from respective governments.

Factors to Consider Before Investing in Ethanol Stocks in India

Now that we have discussed the company overview, let’s check out the things to consider before investing in the best ethanol stocks in India.

Regulatory Environment

Government policies and subsidies are a very critical factor in the production and profitability of ethanol. Favorable regulations may boost the sector, on the other hand, adverse changes to the status quo hurt growth.

Raw Material Prices

Ethanol is produced from agricultural commodities like corn and sugarcane. The prices of raw materials may be quite volatile, therefore affecting the cost of production and profit margins.

Technological Improvements

Technological advancement will raise productivity and reduce production costs, making ethanol companies competitive enough to be able to invest in R&D.

Demand in the market

Its application in biofuel and other industries will define the market demand for ethanol. Changes in consumer preference and energy policies influence such a demand.

Environmental Impact

The present world is drifting towards sustainability and the environment. Firms that show environmentally friendly practices with reduced carbon footprints will attract more investors.

How to Invest in the Best Ethanol Stocks in India

Now that we have discussed the company overview of the best ethanol stocks in India, let’s check out the steps to invest:

• Research the ethanol industry for growth potential, market dynamics, and government policies. Understand the trends in biofuel demand and the technological trends in this sector.

• Understand your risk tolerance and your goals for investment. The return on investment you want will help you decide on the quantum of investment to be made in top ethanol stocks.

• Research individual stocks of ethanol companies by studying their balance sheets, annual reports, and recent press releases. See how they are doing, their prospects for growth, and their position within the market.

• Seek financial advisor advice and get feedback on your strategy. With their expertise and experience, you will be better equipped to handle the complexities involved in investing in the ethanol industry.

• Check the ethanol stocks, which are listed on main exchanges like NSE, and then filter the performing ones. Make sure to have a diversified portfolio to help manage your risks and optimize your potential returns.

• Open Demat account with a certified stockbroker like Rupeezy so that you manage your transactions and investments effectively.

• Regularly monitor your investments and stay updated on ethanol industry news to make timely decisions and adjust strategies as needed. Do consider all the discussed factors before investing in best ethanol stocks in India.

Conclusion

In other words, ethanol stocks might be very promising in the face of India's growing commitment toward renewable energy and sustainable fuels. In this article we discussed the best ethanol stocks in India and the industry overview which reflects the high potential of the sector, bracing up under government mandates, increasing demand for biofuels, and technology advancement. Apart from helpful policies and increased ethanol blending, these companies will benefit from diversified operations and strong market positions. However, Investors are advised to do their research before investing in these stocks