Why are Agro-chemical companies gaining?
DSIJ Intelligence / 25 Apr 2017
In China, the stringent environmental norms are the main reason behind shutting down of factories, thus resulting in price rise for agro-chemicals like pesticides and herbicides.
Dhanuka Agritech, Insecticide India and PI Industries are gaining steadily on the bourses over past five trading sessions, outperforming the broader markets. Dhanuka Agritech is up by nearly 8.3 per cent, PI industries is up by nearly 7.2 per cent and Insecticide India is up by nearly 6.8%.
The common trigger for these stocks can be the expectation of price rise of agro-chemicals like pesticides and herbicides in the Indian market. The price rise is expected to be around 20 percent for agro-chemicals owing to steady rise in crude oil prices, and shutting down of several raw material factories in China.
In China, the stringent environmental norms are the main reason behind shutting down of factories, thus resulting in price rise for agro-chemicals like pesticides and herbicides.
The expected price rise for the pesticide and herbicides along with overall bullish market environment augurs well for the said stocks.
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