LT Foods’ specialty rice sees remarkable growth, propelling profits and market presence
LT Foods, renowned for its ‘DAAWAT’ brand of rice, reported impressive financial results for the June quarter, with a noteworthy 44 percent year-on-year increase in profit after tax (PAT), reaching Rs 137 crore compared to Rs 95 crore in the corresponding period last year. Ashwani Kumar Arora, the MD & CEO of LT Foods, revealed that their specialty rice division contributes a significant 80 percent to the company’s total sales.
Arora further shared that their specialty rice segment, encompassing prominent brands such as ‘Daawat’ in India and ‘Royal’ in the USA, achieved a commendable growth rate of 24 percent. This growth was driven by a balanced combination of a six percent increase in volume and an impressive 18 percent rise in value. He expressed confidence in the success of their growth strategies, as well as their margin expansion strategy, reinforcing their optimistic outlook for the future.
LT Foods recorded a substantial 10 percent year-on-year growth in total revenue, reaching Rs 1,789 crore in the June quarter compared to Rs 1,620 crore in the same quarter of the previous year. The company’s EBITDA margin also witnessed a remarkable improvement, surging to 7.7 percent, reflecting a 181 basis point increase from 5.9 percent in the year-ago period.
Arora explained that the company’s EBITDA margin of 12 percent is sustainable, given that the freight rates, which experienced fluctuations over the past eight quarters, have now stabilised. He emphasised that the improved gross margin from the last quarter is anticipated to remain positive.
The core business of LT Foods, centered around Basmati and Other Specialty Rice, experienced a remarkable 24 percent growth in the June 2023 quarter. This achievement can be attributed to the company’s consistent investments in building its own brands, such as ‘Daawat,’ ‘Royal,’ ‘Heritage,’ among others, and expanding its robust distribution network. These factors have undoubtedly contributed to LT Foods’ remarkable performance and market presence.
Shares of LT Foods are trading at Rs 173.25, up 4.81 percent from the previous close on the BSE.
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