The shares of Adani Wilmar surged 4.84% to ₹ 763.90 apiece on Monday’s early trade after Indonesia banned palm oil exports. Adani Wilmar has a chance to get margin benefits as the ban will drive oil prices higher and the company has a lot of unsold inventory.
Indonesia is the world’s top palm oil producer and a ban on palm oil exports shocked the global edible oil markets and sparked an alarm among major importers of the cooking medium.
This is a reason for worry as far as India is concerned because it is the world’s largest importer of edible oils, specifically the highest importer of palm oil and soybean oil.
Palm Oil is widely used all around the world as vegetable oil and it is used in the manufacturing of many products like biscuits, margarine, laundry detergents and chocolate.
Soya bean oil has hit an all-time high of ₹ 83.21, up 50% year to date (YTD), while the prices of palm oil are up 34% year to date (YTD).
Sunflower oil supplies have already been affected by the Russia-Ukraine war. All these factors combined are adding pressure to household budgets.
Most edible oil companies saw again in their share prices after this ban. Raj Oil Mills gained about 10%, Gokul Agro Resources Limited was trading 5% higher and shares of Patanjali owned Ruchi Soya were 0.84% higher.
Brokerage firm Axis Direct has given a buy call on the shares of the company :
- CMP: ₹ 763.90
- Entry Price: ₹ 753.00
- Stop Loss: ₹ 715.00
- Target: ₹ 790.00
- Upside: 3.42%
- Duration: 5 to 30 days
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