LT Foods posted a 22% increase in H1 FY27 revenue to ₹6,414 crore, aided by strong performance in North America. However, shares fell over 6% as investors reassessed the company's valuation despite operational improvements and a net cash-positive balance sheet.
LT Foods, a player in the basmati rice segment, reported a 22% rise in its revenue for the first half of the 2027 fiscal year, reaching ₹6,414 crore. Despite the revenue growth, the stock market reaction was negative, with shares falling 6.27% to ₹367.30 during Wednesday's trading session.
The company’s financial health appears stable on paper. EBITDA climbed 17% to ₹721 crore, and the company transitioned to a net cash-positive position of ₹247 crore. Operational efficiencies were also noted, with the working capital cycle reducing by 31 days to 143 days. This indicates the firm is managing its inventory and receivables more effectively than in previous periods.
The primary driver for this growth remains the North American market, which contributes half of the company’s total revenue. The Royal brand, which holds a significant share of basmati rice imports in the United States, grew 21% year-on-year. To reduce dependence on existing products, LT Foods is expanding its portfolio. It has introduced microwaveable rice cups under the Golden Star brand in the US and launched Daawat Rozana Platinum in the domestic Indian market.
Despite these operational gains, the stock has been under pressure, currently trading about 25% below its 52-week high of ₹490.70 reached in August. With a price-to-earnings (P/E) ratio of 20.71 and a market capitalization of ₹12,754.60 crore, the recent share price drop suggests investors may be adjusting their valuation expectations after the stock's run-up earlier this year.
Going forward, investors will likely monitor whether the company can maintain its margin levels, effectively manage the growth of its newer product lines, and navigate the competitive landscape in both the domestic and international markets. The ability to sustain cash flow while investing in new categories will be an important metric for tracking long-term performance.