Last year, the exporters, who bought during harvest time made losses as the price kept on falling throughout the year though being off season. The reason was the disruption caused by high MEP price slapped on basmati exports due which exports became uncompetitive. The MEP was lowered/removed only in late October/November. Also the complete ban on xports of deoiled rice bran cake made rice prices uncompetitive to the basmati shellers.
Now after almost two years the ban on dorbc has been removed…
It seems raw material (basmati) prices will remain subdued (one bitten twice shy) and exporters if they can find and sell in non US market can make decent profits.
I think CLSE is in that sweet spot (atleast as of now :-). let’s see how is the quality and quantity of basmati crop arrivals in mandi.
Too much and too frequent disruptions/interventions by government actually hurts both farmers and industry . Same was the story in edible oils when stocking was completely banned post Ukraine war. It took two years for things to cone on track post removal of disruptions.
Disc: invested
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Management is confident of doing 900 revenue in H2 fy25. Punjab floods have almost no effect on procurement. Initially during the floods price of basmati rice rise for week and eventually got tapered. In H1 of fy25 they have done revenue of 600 rupees. speed of business will increase in H2. New plants are already ready. Disclaimer: Bought my third tranche today itself. Hoping to see chaman lal doing good business in coming months.
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Hi Folks,
New to the thread ,
Actually I was going through the data which is published by ministry of commerce,
| Commodity |
values in crores |
|
|
|
%change |
|
|
Feb-25 |
Apr-24 to Feb-25 |
Feb-26 |
Apr-26 to Feb-26 |
Feb-26 |
Apr-25 to Feb-26 |
| RICE |
10387 |
95511.38 |
10901.72 |
92777.81 |
4.96 |
-2.86 |
Coming in the context of the company, like what does this mean for the company in such War times?
I would like to present some glimpses from the concall which was conducted in February 2026,
- Management Reiterated No exposure to Iran and if it was minimal it was conducted on advance mode only, the company is in no mood to conduct risky trades.
- Regarding Saudi arabia and GCC nations , the current export are mostly halted like in the month of march 4,00,000 MT of rice ( exporters data and not of company specific) to be exported was halted ( 2 lakh MT in transit and 2 lakh MT at ports) leading to slashing in prices in domestic markets. For instance, prices dropped from 8000 Rs. to 7200-7500 Rs. / Quintal.
- The next question that comes into mind, who will Absorb Extra supply , it can be diverted to other countries but the cost is discount and how much discount ( can’t say?) because Freights rate have almost been doubled , stock is piling. Hang on, This is definitely not a panic situation but a quarter where it will have 3 effects , Low Volume, Low Realisation, Low Margins. So, definitely a Hit on EBITDA.
- Talking about the Financials and valuation. Q3 was good in terms of revenue, looked like company was back on track until the event hit of war, so Q4 is going to be tough for the company , its good that company achieve 1500 crore Rs. of annual revenue once again but there will be dip in the margins and that will be hurting. Fingers crossed.
- What I like about the company is they are utilizing borrowing limits judiciously, even the promotor has lent significant amount of money to company confirming skin in the company. In War like scenario Cash is the King and Chamanlal setia as a company is managing wonderfully i.e they are able to Realize from Old debtors. you will wander ‘ what’s new?’ , the strategy is they are not aggressive about Revenue , they only do business when the terms are favorable for the company.
On a concluding Remarks, i am not commenting on stock price , but seems like still room for stock to correct on a pure valuation basis because Q4 is staged to be impacted. Need to monitor the competitors comments and updates , but a small company like chamanlal setia offers great value when the war clouds gets cleared.
Disclaimer - I am not an financial Advisor. This is purely for Educational Purpose.
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