KRBL expects lower H2 margins on higher paddy cost

KRBL Limited (KRBL) has indicated that H2 margins are expected to be lower than H1 margins. The company expects some compression in margins in the second half Management noted that basmati prices in India have been rising since January this year. The Middle East remains the largest market for basmati exports. Paddy prices are nearly 30% higher than last year. The company has taken price increases across its portfolio in the current quarter to partially offset the higher input costs. The key triggers are the expectation of margin compression in H2 and paddy prices being nearly 30% higher than last year. This reflects cost pressure from elevated raw material prices despite recent strong realizations. Peers such as LT Foods, Chaman Lal Setia and GRM Overseas may face comparison on margin trends and paddy cost pass-through. Near-term prices could react cautiously to the guidance on lower H2 margins. Risks include sustained high paddy costs, weaker export demand from the Middle East, or limited success in price increases. Competitors listed: LT Foods, Chaman Lal Setia, GRM Overseas. We have no financial interest in this news.