LT Foods Ltd, India’s premier rice exporter, is regaining its footing after a volatile year due to trade protectionism and shifting global tariffs. The shares, which retreated from an all-time high of ₹519 in July, are finding support again as the company navigates a complex regulatory landscape in the US, its most critical market. The shares are now at ₹406.30.
The key reason for the recovery is a significant reduction in US import duties. After facing a 50% tariff on Indian rice imposed in August, the company received some support in February when the rate was reduced to 18%. The US accounts for about 46% of LT Foods’ total revenue, making the tariff relief vital for the company’s outlook.
Despite geopolitical conflicts, the owner of the Daawat and Royal brands has shown unexpected strength. By using brand loyalty to pass cost increases to consumers, the company maintained an Ebitda margin of 11% through 9MFY26, remaining consistent with its five-year average. “Paddy (raw rice) accounts for about 70-80% of LT Foods’ total input costs, making it the most critical variable in the company's cost structure,” said Motilal Oswal Financial Services.
Rival KRBL has a higher Ebitda margin (14% as of 9MFY26) as compared to LT Foods. However, KRBL's margins are highly volatile.
Also, LT Foods' 9MFY26 revenue growth was 25%, and it should likely end FY26 at the same pace.
Investors are now weighing the company's ability to take advantage of this support against persistent risks, including a 12% rise in raw material costs and fluctuating global freight rates. Here, the company’s diversified presence across markets and improving financial position offer some comfort.
With revenue growth projected at a 13% CAGR through 2028, the market is watching whether the move toward its organic foods (Ecopure) and ready-to-eat products can sustain long-term valuation gains. These segments not only expand the addressable market but also improve the product mix toward higher-margin categories.
To be sure, high paddy prices, rising freight costs, and global uncertainties can hurt margins in the near term. Based on Motilal’s estimates, the stock trades at 17 times FY27 earnings. Valuations appear reasonable, and the improving business outlook can help investor sentiment.