Chaman Lal Setia Exports , a leading Indian rice exporter, reported stable volumes but a decline in revenue for Q1, as the company navigated through geopolitical challenges and price volatility in the global rice market.

Stable Volumes, Revenue Decline

The company reported total volumes of 41,255 tons for Q1, remaining relatively flat compared to 41,169 tons in the same period last year. Export volumes stood at 33,797 tons. Despite stable volumes, revenue declined by approximately 15% year-on-year, primarily due to lower rice prices in the global market.

Geopolitical Challenges Impact Business

Management cited various geopolitical issues as factors affecting business decisions during the quarter. These included conflicts involving Russia-Iran and disruptions in markets such as Lebanon and Yemen. Chaman Lal Setia Exports operates across 94-95 countries, highlighting its broad global presence.

New Processing Units Operational

Chaman Lal Setia Exports has made progress on its capacity expansion plans:

• A new processing unit in Mundra became operational from July 4th.
• Two out of three new units in Karnal are now operational.
• Each new unit is capable of generating annual revenue of approximately INR 100.00 crore.

The company is currently operating these new units at about 50% capacity, with plans to ramp up as market conditions improve.

Strategic Approach to Market Volatility

Management indicated they deliberately slowed business operations in Q1 due to expected rice price declines with the new crop season. The company has adopted a strategic approach to inventory management:

• Reduced inventory levels while awaiting lower-priced new crop arrivals.
• Focused on maintaining stable margins despite lower revenues.

Financial Position and Outlook

Chaman Lal Setia Exports remains debt-free, with a strong cash flow position. For Q2, the company is targeting revenue of INR 400.00 crore, anticipating improved market conditions.

US Tariff Impact and Market Expansion

The company addressed concerns about the recent US tariff increase to 25% on Indian rice exports:

• Management expects minimal impact on their ethnic customer base in the US.
• The company is exploring opportunities in new markets, including Russia and Japan.

Conclusion

Despite facing challenges in Q1, Chaman Lal Setia Exports maintains a positive outlook for the coming quarters. The company's strategic approach to market volatility, coupled with its expanded production capacity, positions it to capitalize on improving market conditions in the global rice trade.

Chaman Lal Setia Exports Ltd. , a government-recognized 3-star export house specializing in rice milling, processing, and exporting, has reported a decline in both profit and revenue for the first quarter of the fiscal year.

Financial Performance

The company's unaudited financial results for the quarter ended June 30 reveal:

Chaman Lal Setia Exports experienced a 15.32% year-over-year decrease in revenue from operations, which stood at 307.27 crore rupees compared to 362.84 crore rupees in the same quarter of the previous year.

The company's net profit also saw a decline, falling by 4.33% to 21.64 crore rupees from 22.62 crore rupees in the corresponding quarter last year.

Operational Highlights

• The total income for the quarter decreased by 15.08% to 309.50 crore rupees, down from 364.45 crore rupees in Q1 of the previous fiscal year.
• Despite the overall decline, the company managed to reduce its expenses, which totaled 280.75 crore rupees for the quarter.
• The earnings per share (EPS) for the quarter stood at 4.35 rupees, not annualized.

About Chaman Lal Setia Exports Ltd.

Chaman Lal Setia Exports Ltd. is primarily engaged in the business of manufacturing, trading, and marketing of rice. The company operates within a single primary reportable business segment. Its corporate office is located in Gurugram, Haryana, with its registered office in Amritsar, Punjab.

The financial results were reviewed by the Audit Committee and approved by the Board of Directors at their meeting held on August 5. The results have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified under the Companies Act, 2013.