BCL Industries shares hit fresh 52-week high - Here's why

BCL Industries share price NSE, BSE: Share of BCL Industries hit a fresh 52-week high on Friday. The scrip opened with a gain of 3.93 per cent and went on to hit a fresh 52-week high of Rs 79.14 on the BSE in the early trade. This is a surge of over 8 per cent from the previous close of Rs 71.17 on Thursday.

The rally is largely led by two factors - the ban on the use of 'sugarcane juice and sugar syrup' to produce ethanol in the 2023-24 supply year and the company's board approved the allotment of 1,01,50,000 equity shares of the face value of Re 1 each as fully paid-up shares at a price of Rs 36 per equity share.

"Considered and approved the allotment of 1,01,50,000 (One Crore One Lac Fifty Thousand) Equity shares of the face value of Rs.1/-each as fully paid-up shares at a price of Rs. 36/- per equity share (including premium of Rs. 35/share), consequent upon the conversion of 10,15,000 (Ten Lac Fifteen Thousand only) Warrants issued earlier for Rs. 360/-, after adjusting the number of shares, paid-up capital per share and premium per share post sub-division of nominal value of the Equity Share of the Company from 1 Equity Share of Rs. 10/- each to 10 Equity Shares of Re. 1/- each out of the balance 38,46,334 (Thirty-Eight Lacs Forty-Six Thousand Three Hundred Thirty-Four) warrants on preferential basis, upon receipt of an amount aggregating to Rs. 27,40,50,000/- (Rupees Twenty-Seven Crore Forty Lacs Fifty Thousand only) at the rate of Rs. 270 (Rupees Two Hundred Seventy Only) per warrant (being 75% of the issue price per warrant)," the company said in a regulatory filing.

Meanwhile, BCL Industries Joint MD Kuchal Mittal told Zee Business that the government's decision will benefit the company as their machinery is capable of making ethanol from maize. 

Grain Based Ethanol का उत्पादन ज्यादा... #EthanolProduction पर Notification का कंपनी पर कोई असर नहीं होगा... आगे कंपनी Ethanol उत्पादन की कैपेसिटी बढ़ाएगी : कुशल मित्तल, ज्वॉइंट MD, BCL इंडस्ट्रीज#NewsParViews #BCLIndustries #SugarIndustry #KushalMittal @AnilSinghvi_ pic.twitter.com/7LC944akuN

— Zee Business (@ZeeBusiness) December 8, 2023

"We have been saying for 4-5 years that maize is a future crop and now the government has made it clear that they want to promote production of ethanol from maize. All our machineries are capable of doing that and it will benefit the company," Mittal told Zee Business Managing Editor Anil Singhvi. 

Earlier on Thursday, the Central government directed sugar mills to not use sugarcane juice for producing ethanol in 2023-2024 as it is worried that the country's sugar output may fall which would lead to a spike in prices.