Discounts hit Q1 margin; see 15-20% FY16 sales growth: KRBL

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26 Aug, 2025 12:21

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KRBL reported an operating profit margin of 14.32 percent despite having seen ‘the worst year for basmati rice on revenue front’ says Anil Mittal CMD of the company. The company’s export margins are 10 percent, he says, adding 65 percent of the production during the quarter was exported.“Year on year (Y-o-Y) it is definitely lesser by 2.5 percent, primarily because market is so bad that we had to give extra discounts, marketing expenses to our distributors worldwide and in domestic market,” he adds.However, the company has done well in comparison to the market which is down by 25-30 percent compared to last year, he says, adding, “Because we are a FMCG product and into branding market, we could maintain the price; and to maintain the price and the sales momentum, we have to provide our distributors an extra pitch to maintain the speed of the sales and the profits.”Speaking to CNBC-TV18, Mittal says the company expects a topline growth of 15-20 percent this fiscal.Below is the transcript of Anil Mittal's interview with CNBC-TV18's Sonia Shenoy and Anuj Singhal.Anuj: We have seen decent numbers from you on the revenue front but not so much on the bottomline front. What went wrong for bottomline and going forward what is the outlook?A: This is actually the worst year as far as whole rice (Basmati) industry is concerned. Even then we are able to maintain topline and botomline. If you look at the bottomline our EBITDA margin is 14.32 percent compared to last quarter of 14.33 percent. However, year over year it is definitely lesser by 2.5 percent and that is primarily because market is so bad that we had to give extra discounts, marketing expenses to our distributors worldwide and in domestic market. So, that way the EBITDA was lower but still we have maintained our profits as well as the topline.Sonia: You said that you had to give a lot of discounts etc. Do you see that continue in the quarters to come and will your margins fall below this 14 percent mark?A: I don't think the margins will go below that. However this year if you compare with the last year already the market is down by 25-30 percent as far as the selling prices are concerned but still because we are a FMCG product and we are into branding market, we could maintain the price and to maintain the price and the sales momentum we have to provide our distributors an extra pitch to maintain the speed of the sales and the profits.Anuj: If you could tell us how was your export business in terms of realisation and the kind of margin that you made in export business?A: In export business margins are nearly about 10 percent and this year we did 65 percent of the export and balance is from the domestic market - I am talking about the quarter.Anuj: What about your average realisation?A: My average realisation would be somewhere between Rs 75-80 a kilo.Sonia: The street is very enthused with the fact that you have managed to do 27 percent topline growth and in a slowing down market like this companies that deliver topline growth are getting rewarded. So, what kind of quarterly runrate can we expect from KRBL in terms of topline growth?A: Topline growth I believe this year also we are going to have a topline increase of about 15-20 percent over last year.