LT Foods, the well-known seller of Daawat basmati rice in India, has recently announced a remarkable 53% surge in quarterly profit. This significant boost in earnings can be attributed to the company’s strong performance in both the domestic market, where there is robust demand for its packaged rice, and the international arena, benefiting from favorable export prices. The success of its flagship product, Daawat basmati rice, has undoubtedly contributed to the company’s impressive financial results.
In the quarter ending on June 30, the rice producer achieved a consolidated profit of 1.37 billion rupees ($16.7 million), marking a significant increase from 896.9 million rupees reported in the same period the previous year.
The company’s consolidated revenue from operations witnessed a robust increase of over 10%, reaching 17.78 billion rupees. This growth was primarily driven by a remarkable 24% year-on-year expansion in the company’s core basmati and other specialty business segments.
During the quarter, the company experienced a moderate increase of approximately 9% in total expenses, contributing to an enhancement in its profit margins.
LT Foods, deriving 65% of its revenue from exports, has reaped the advantages of export prices surging to a five-year peak by the end of June. This significant increase in export prices was primarily attributed to limited supplies and the government’s decision to elevate support prices for the key crop in early June.
In May, India, recognized as the largest global exporter of rice, announced its decision to facilitate rice shipments exclusively through diplomatic channels. This move came as a continuation of the export restrictions imposed in September of the previous year, which were aimed at stabilizing domestic prices of the essential food crop.
According to Ashwani Arora, the Managing Director and CEO of LT Foods, the company’s domestic market share witnessed a significant rise of 210 basis points, reaching 29.8% during the quarter. This increase indicates robust demand for the indigenous staple within the country.