Indian rice exporter LT Foods records surging Q2 profits due to high demand for basmati rice
Published on: October 30, 2023.
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LT Foods, an Indian rice producer and exporter, has reported a significant surge in quarterly profit driven by strong demand for its basmati rice. In the quarter ended September 30, the company’s consolidated profit reached 1.56 billion rupees, marking a 74.3% increase compared to the same period last year when it was 895 million rupees.
The company’s consolidated revenue from operations also witnessed a rise of over 14% to 19.78 billion rupees, mostly due to a 23% growth in its core basmati and other specialty businesses. Meanwhile, total expenses escalated by approximately 12% to 17.92 billion rupees.
LT Foods attributes the improved profit margin in its core segment to increased investment in its Daawat brand basmati rice, effective marketing strategies, and an increase in market share. Managing Director and CEO Ashwani Arora noted that the market share of Daawat brand in India rose to 30.2% during the quarter, representing a growth of 160 basis points.
The Indian government, which is the largest exporter of rice globally, imposed a minimum export price (MEP) of $1,200 per ton on basmati rice shipments in August in order to regulate local prices. However, this MEP was recently reduced to $950 per metric ton, leading to expectations that it will restore the competitiveness of Indian basmati rice shipments in the global market.
Following the release of these positive results, shares of LT Foods initially surged by 8.6%, although gains were later pared.
Source: [Zawya](https://www.zawya.com)
