BNP Paribas ups Shree Renuka to 'buy'

BNP Paribas has upgraded Shree Renuka Sugars to "buy" from "hold" with a target price of Rs 110 from Rs 75 earlier to reflect the profitability from Brazilian subsidiaries and higher sugar prices.

In a note, BNP Paribas said that company's Brazilian operations look well positioned to benefit from a strong rally in sugar prices. The note added that company has bought put-options to protect approximately 75 percent of its Brazilian production at U.S. $ 0.20/lb.

"The refining segment has good long-term prospects as Asia will likely continue to drive consumption and remain an importer of raw sugar," the brokerage said in the note. It added that the company will also benefit from resumption of ethanol supplies at an attractive price of Rs 27 per litre.

At 12.30 p.m., shares of the company were down Rs 87.50.

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