LT Foods Pegged for 518-Target by Geojit Financial Services

LT Foods Ltd. (LTF) Financial Performance Report

Company Overview

LT Foods Ltd. (LTF) is a global consumer specialty company with a focus on basmati rice, organic foods, and ready-to-eat/cook (RTE/RTC) products. The company has a presence in over 80 countries, with significant regional exposure in the US, Europe, and the Middle East.

Third Quarter Financial Performance

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For Q3FY26, LTF's revenue grew by 24% YoY, driven by broad-based strength across geographies despite the US tariff headwind. Segment-wise, Basmati revenue (86% mix) grew by 25% YoY, while organic (8% mix) declined by 7% YoY, and RTE/RTC-Ready to Heat/Cook (1.5% mix) witnessed flat growth YoY.

Key Financial Metrics

• Gross margin improved by 70bps YoY to 34.2%, supported by softer input costs and better procurement.
• EBITDA margin grew by only 20bps YoY to 11.2% due to increased spend on brand and strategic initiatives.

Crop 2025 Basmati Production and Outlook

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Crop 2025 basmati production was lower than estimates due to weather-related disruption, and strong demand indicates higher prices.

US Trade Developments

LTF's subsidiary, Ecopure Specialities Ltd (Organic segment), received a preliminary notice from the US DoC for a CVD @ 340% (~Rs.170cr) on sales of Rs. 50cr (0.6% revenue mix) pertaining to CY23. The duty has now been reduced to 75.5%.

Valuation and Recommendation

We value the stock at 17x on FY28 EPS (3Yr avg. 17x) to arrive at a target price of Rs.518. We recommend a BUY due to healthy volume outlook.