Lt foods (daawat)

Stock Opportunities
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They got it
Check latest announcements
Last month only high court gave order

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Thanks for sharing - but this report and recommendation is not meaningful for long term investors with time frames of 5~10 years (like me). The report itself states that LT foods is growing market share and expected to have strong cash flows until 2026, so the long term runway looks good and price seems reasonable for the quality of business.

I also found it hilarious that Geojit’s price target moves exactly with the stock price. It’s almost as if they look at current price and add +/- 5% depending on some arbitrary assumptions - they had a sell rating at 160 INR in August 2023 - the stock has gone up 55% since then!!

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Thanks,
Sharad
OpenSourceInvestor @ Substack

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This is in general good for the company. Is there a way to quantify the impact now or we will have to wait and watch?

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Parboiled is useless for lt foods they dont deal in it
Basmati rice specific need to be seen

Its overall a sentimental booster
It has given better visibility to stock
This quarter results are very very important now
If company delivers well despite red sea issue we will see a re rating
Part of this can be absorbed through intreste reduction and part can be absorbed through passing cost to consumer as promised by arora ji
Lets see where we land
Interesting days ahead

Buisness is great
Valuation great
Just need a re rating and stock will see sky

Its overall a sentimental booster
It has given better visibility to stock

P.s 1 min silenece for those who sold after geojit report

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Pessimistic view: Lets assume the RTH & RTC did not contribute much, How much the Basmati rice exports can go up from here? Exports can grow at max 10% every year(world rice consumption can grow gradually). Isn’t already Big fish in small pond?

Just want to understand, what could go wrong?

  • Disclaimer invested.
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LT foods has doubled revenues in the last 5 years. They have a double engine for domestic growth: (1) increasing GDP per capita will increase overall rice consumption per capita, plus (2) as disposable income increases, more people will buy basmati rice, which is seen as a premium rice product in most of the country. Richer consumers will also chose premium / trusted brands like Daawat / Royal. Hence, if LT Foods retains its market share and “premium” branding, they should grow faster than Indian GDP growth. Exports will be the cherry on top, with increasing Indian diaspora abroad and also Indian food gaining popularity with foreigners.

So, I see a good runway ahead of growth between 8%~12%. But f you’re expecting 20%+ growth, this is probably the wrong company to invest in.

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Thanks,
Sharad
OpenSourceInvestor @ Substack

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Saudi Market alone is 10K cr market
Lt foods have negligible present in middle east which is biggest market ,
Just see opportunity and look at domestic there is massive shift from unorganized to organized
Lots of hypermarkets are expanding , Quick commerce also , matter of time these chains will penetrate in rural and tier 2 tier 3 cities, growth coming from these will be massive

Also just to give idea how big market is , in Concall , Mr Arora said they are competing with Biggest private label player in USA which does approx 2 Bn Dollar turnover in USA ,

Also domestic basmati realization is steadily increasing,
Company also expanding in africa, so core buisness is very strong

also you guys are forgetting that organic which was major in 3 4 years is actually showing de growth this year due to some anti dumping duty on Soya in USA which i hope will be revoked soon

Multiple growth elements are there in core buisness itself

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New facility in UK Market

they target 100 Million pounds revenue in 5 years

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Any details on what exactly they gonna manufacture there? Press release seems vague

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LT Foods’ export revenues have gone up by ~16% CAGR over the last 5 years (FY19-23). Their annual report mentions that the global basmati market grows at a rate of ~1-3% pa. This looks to me a very favorable situation to be in, considering that they are doing something right to achieve these rates in a slow growing sector which is also fragmented. Additionally, as Aadesh said, Middle East is the largest market (~40% of global demand if I am not wrong), and LT foods has a very small market share there. That gives long runway for growth

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offcourse rice based products which is RTC and RTE and Rice exports

With this new facility, LT Foods is set to revolutionize the rice market in the U.K. and meet the
growing demand for authentic and premium rice and rice-based food products. To ensure
consumers experience the finest quality of rice and rice-based food products from the trusted
brands of LT Foods, the facility will house the latest technology and state-of-the-art infrastructure.
Located in Harlow, the new facility is spread over an area of an impressive 100,000 square feet. This
location offers strategic advantages, allowing LT Foods to efficiently serve the U.K. market. To
provide a diverse range of options to meet varying consumer demands, the facility will offer both
branded and private-label products.
The rice and rice-based food market in the U.K. is worth around ÂŁ 1 billion. To tap this opportunity,
LT Foods has made an initial investment of ÂŁ 7 million in this new facility with a commitment of
further investment upto ÂŁ 50 million in the coming years. The company is expecting annual revenue
to the tune of ÂŁ 50 million over the next 2 years, with a targeted ÂŁ 100 million within the next 5 years.
The company will also provide employment opportunities to local talent.
The company has already partnered with 4 leading retailers in the U.K. with plans to further scale
this up. Moreover, the facility boasts a production capacity of 60,000 tonnes of rice per annum,
setting the stage for substantial growth in the coming years.
Speaking on the occasion, Mr. Vijay Arora, Chairman & Managing Director, LT Foods said, “We are
very excited about our newest cutting-edge facility in the U.K. It is an important market for our future
growth as we intend to make deep inroads in this market. LT Foods long-term goals include
solidifying its market presence in the UK, becoming a leader in the rice and rice-based food segment,
and continually innovating to meet the evolving demands of consumers. This new facility is a critical
step in achieving these objectives and furthering LT Foods’ mission of delivering high-quality rice
products to global consumers

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Results are out

15% growth in topline
Eps better q2q yoy
Finance cost down

Further growth will be from uk factory and tanazania factory

Keep calm and eat biryani

Slow but steady wins the race :slight_smile:

I hope it holds today’s levels , after evry results lt foods fall 3 4% even after great results , idk why but always been this trend
After taxes this is only thing permanent in life :smile:

I am expecting good compounding in my fmcg trio
Lt foods adf foods and sri bajrang alliance

Lets see how it goes

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i attended concall today it was a long concall stretched over 45 min with lots of questions

Saudi is approx 2mn tonne market ,top most priority
Entered new markets
red sea issue impacted growth and margin both, issue is expected to be resolved in 1 2 quarters
cuppa rice growth has been disappointing
Rest portfolio of RTE doing good
core buisness doing good in USA capacity doubling this year
Currently not passing rising input cost, next qtr input cost will be littile higher than current qtr
kari kari sales doubled
ready to eat not doing well india , ready to cook expected to do well
Uk is 1bn dollar market .uk revenue will be addition to current europe market revenue
Margins being stable as compared to krbl because brand power
.intrest money will be received soon (i am expecting in this qtr)
.dawat jasmine next month launch india

This story is unfolding nicely but growth will be in similiar 15 20% region for 1 2 quarters in my opinion
Good thing is company focusing on middle east
The growth like FMCG may come in 1 year
Lot of things have started in process

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Basmati paddy prices dropped by 28%
Can be a bumper year for rice companies as input cost decreases sharply
Also I expect MEP reduction before Haryana election

Let’s see how it goes

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In my opinion, one should be cautious at this valuation. Untill and unless their topline revenue shifted from rice business to value added product’s ,it would be treated as a commodity and cyclical business. however, management is transforming the business to another level with addition of different revenue verticals but at this moment new entries shall be checked twice. Even though management is good we have to look at current valuations before entering. Thank you.

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I seriously don’t think it will ever happen

This will be always rice company
Just to put things in perspective rte and other will contribute max 10% to revenue by 2028

It’s upto you if you believe in domestic packaged food consumption story

But this will be always a rice :rice: company

RTE RTC will be second fiddle
I don’t see it contributing more than 25% of revenue even in next 5 years

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Anyone knows what are the states in India that cover GI tag for basmati rice?

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Punjab Haryana west UP

Top3

Not sure but uttarakhand is also there i guess

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I am curious to know if MP is part of GI tag

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