India’s basmati rice exports might remain flat in FY25, says KRBL CFO

Noting that the demand for removing the Minimum Export Price (MEP) of $950 per tonne doesn’t directly concern his company, Jain stressed on the need to re-evaluate the floor price to prevent Indian basmati from being priced out by its closest competitor, Pakistan.

KRBL mainly sells packaged basmati rice domestically and in the export market, with ‘India Gate’ being its flagship brand.

Jain stated that out of the 9 million tonnes of basmati produced annually in India, around 2.5 million tonnes are sold domestically, with the share of branded basmati rice being approximately 0.6 million tonnes per year.

KRBL holds about 35 per cent of the domestic branded basmati rice market.

Jain also noted that the domestic demand for branded basmati rice is growing due to a shift from non-branded to branded packaged rice, especially following the COVID-19 pandemic.

He reported an 18 per cent growth in the domestic business in the last financial year.

Furthermore, Jain mentioned that basmati rice prices have decreased by 10-15 per cent since January 2024 due to various factors, such as higher production compared to the previous year and changes in policies or prices in importing countries.

Addressing the recent controversy over the Geographical Indication (GI) tagging of Indian basmati rice versus Pakistan in the European Union, Jain stated that such issues do not impact the branding of Indian basmati rice in the short term.

As part of the company’s strategy, KRBL aims to expand the distribution of branded basmati rice across the country to reach a target of over one million outlets, as they are currently present in less than 4 lakh outlets out of the total 7 lakhs.

Jain also revealed the company’s growth strategies, which include making it easier for consumers to shift to packaged rice, expanding basmati distribution, and launching new products.

While he didn’t provide specific revenue and profit guidance for FY25, he expressed optimism for double-digit year-on-year revenue growth based on continued growth in the domestic segment and increased exports.

In FY24, KRBL’s total income was around Rs 5481.35 crore, compared to Rs 5457.24 crore in the previous financial year.