Moneycontrol
Jan 11, 2017 01:47 PM IST | Source: CNBC-TV18

Remain optimistic on sugar space: G Chokkalingam

G Chokkalingam, Founder & Managing Director of Equinomics Research & Advisory continues to remain optimistic on sugar space by next one year and believes KCP Sugar can tactically give 20-30 percent return within a year's time.

G Chokkalingam, Founder & Managing Director of Equinomics Research & Advisory told CNBC-TV18, "We recommended many times KCP Sugar. It is down by 26 percent from the peak. Of course it has not done well with the way the UP based companies have done but I formally believe that it can give anywhere from 20-30 percent return in a year's time. With strong balance sheet, it is one of the sugar companies which has the least debt, the debt is less than 10 percent of the total capital employed. If you look at most sugar companies, most of them have lot of debt to finance the inventory." 

"This is a rare company, it finances large part of inventory using own finance. It has come out of the good results. Also, the sugar recovery is very decent and it is based in Andhra Pradesh which is close to Godavari Basin, so the recovery rate is also very impressive," he said.

"I continue to remain optimistic on sugar space by next one year and believe this can tactically give 20-30 percent return within a year's time itself."

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