LT Foods Limited has announced the incorporation of a new wholly owned subsidiary in Dubai, UAE, as part of its strategy to strengthen global operations and enhance international business synergies. The company informed stock exchanges BSE and NSE about this corporate development under Regulation 30 of SEBI Listing Obligations and Disclosure Requirements Regulations, 2015.

New Subsidiary Details

The new entity, named LTF Global Investments L.L.C., will be established in Dubai with specific focus on providing strategic services to the company's international operations. The subsidiary represents LT Foods' commitment to expanding its global footprint and operational efficiency.

Strategic Objectives and Business Purpose

The wholly owned subsidiary has been designed with clear strategic objectives to support LT Foods' international expansion. The primary purpose of LTF Global Investments L.L.C. is to provide global strategic services to LT Foods group's international businesses across multiple regions including USA, UK, Europe, and other international markets.

The establishment of this subsidiary aims to achieve:

• Better operating efficiencies across international operations
• Enhanced synergies between different regional businesses
• Streamlined strategic services for global markets
• Improved coordination of international business activities

Transaction Structure and Compliance

The investment structure has been carefully planned to ensure regulatory compliance and proper corporate governance. LT Foods will subscribe to 100% of the equity in the new subsidiary through cash consideration, making it a completely owned entity.

The company has confirmed that this investment will be treated as a related party transaction and will be conducted on an arm's length basis, ensuring transparency and compliance with regulatory requirements. No specific governmental or regulatory approvals are required for this acquisition.

Corporate Disclosure and Timeline

LT Foods has fulfilled its disclosure obligations by informing both BSE Limited and National Stock Exchange of India about this corporate development. The company's communication, signed by Company Secretary Monika Chawla Jaggia, included comprehensive details about the subsidiary incorporation as required under SEBI regulations.

Since the entity is yet to be incorporated, historical financial information such as turnover for the last three years is not applicable. The subsidiary will focus specifically on providing global strategic services to support LT Foods' established international presence and operations across key markets.

Indian basmati rice exporters faced market volatility as geopolitical tensions surrounding Iran trade relations sparked investor concerns. LT Foods and KRBL, two prominent players in the basmati export segment, experienced temporary selling pressure before stabilising during the trading session.

Market Reaction to US Tariff Announcement

The US decision to impose a 25% duty on countries maintaining direct trade relations with Iran triggered immediate market reactions in basmati rice exporter stocks. LT Foods shares declined 3% while KRBL fell 2% before recovering later in the day. Despite the initial volatility, market participants noted that the US represents a relatively small portion of India's basmati export market.

Iran's Strategic Importance in Basmati Trade

Iran remains one of the most crucial markets for Indian basmati rice exporters, ranking as the second-largest destination after Saudi Arabia and Iraq. The country imported approximately 8.5 lakh tonnes of basmati rice from India in FY25, representing 12-20% of total basmati exports. This significant exposure explains why stocks with higher Middle Eastern market presence, particularly KRBL and LT Foods, attract attention during Iran-related geopolitical developments.

KRBL reported direct Iran market exposure of $8-10 million, suggesting limited immediate impact from potential US tariff measures. The company generated export sales of ₹1,473.00 crore for FY25, with the Middle East accounting for a substantial portion of overall basmati export revenues.

Structural Demand Trends Support Growth

Despite geopolitical uncertainties, Indian rice exporters continue benefiting from robust global demand patterns. India's total rice exports reached 21.55 million metric tonnes in FY25, marking a 19.4% increase from the previous year. This growth demonstrates the underlying strength and resilience of the export sector.

LT Foods has highlighted increasing demand for basmati and specialty rice varieties across North America, Europe, and Gulf countries. The company particularly noted growth in value-added products including pre-cooked rice and biryani kits, indicating premiumisation trends in key export markets.

Price Dynamics and Market Outlook

Basmati rice prices have softened to ₹75.00 per kg compared to previous levels of ₹80.00 per kg, despite maintaining strong export volumes to Iran at 8.5 lakh tonnes in FY25. This pricing adjustment reflects broader market dynamics rather than Iran-specific factors.

The tariff-related volatility demonstrates how global political developments can influence agri-export stocks, even when direct exposure remains limited. With export growth continuing and demand holding steady across key regions, the market reaction appears more sentiment-driven than structural, though Iran-linked risks and pricing trends require ongoing monitoring.