krbl ltd share price Management discussions


The global economy was on the path of recovery in 2021 as the economies started opening up and travel restrictions were relaxed post the pandemic. Stepping into 2022, the global economic performance continues to be influenced by Covid-19, as well as supply issues and inflationary pressures. However, the global growth prospects have weakened significantly owing to the start of the war in Ukraine. After rebounding to an estimated 5.5% in 2021, the economy global growth is expected to have decelerated markedly in 2022 to 3.1%, reflecting the economic impact of the geopolitical tension and continued COVID-19 flare-ups, diminished fiscal support and lingering supply bottlenecks.

The war in Ukraine has upended the fragile recovery from the pandemic, triggering a humanitarian crisis in Europe, pushing up food and commodity prices and exacerbating inflationary pressures worldwide. Geopolitical and economic uncertainties are dampening business confidence and investment and further weakening short-term economic prospects.

Against this backdrop, the global economy is now projected to grow by only 3.1% in 2022 and 2023.


The Indian economy has emerged as one of the fastest growing economies, as India continued to make remarkable economic progress since 2000. According to the government, between 2011 and 2015, over 90 million people have been lifted out of extreme poverty. After growing at very high rates for years, Indias economy had already begun to slow down before the onset of the COVID-19 pandemic. Between FY17 and FY20, growth decelerated from 8.3% to 4.0%, with weaknesses in the financial sector compounded by a decline in the growth of private consumption. However, the Covid-19 pandemic led Indias economy into a contraction in 2022, despite well- crafted fiscal and monetary policy support.

Following the severe second wave, growth in FY22 is expected to be around 7.5%. According to IMF, Indias economic growth projection for calendar year 2022 is expected to be around 8.8% from the previously forecasted 9.1% earlier, citing high inflation. India is ^ on the path to a sustained economic recovery, thanks to the vigorous countrywide drive to deliver safe and wide-reaching Covid-19 vaccinations, which helped reduce the severity of the third pandemic wave with minimal disruptions to mobility and economic activity. However, owing to the onset of the Russia-Ukraine conflict, the crisis has clouded Indias growth outlook. Rise in prices of crude oil, food and fertilizers are likely to weigh on household finances and spending in the months ahead directly and indirectly.

Further, rate hikes undertaken to prevent energy and food inflation from becoming more generalized are expected to slow the recovery momentum. India imports vegetable oils, machines, fertilizers, chemicals from Ukraine and is the largest importer country for Ukraine. It imports crude oil, precious metals and stones, mineral fuels, weapons etc. from Russia. Due to present conflict various items which had been imported from Russia and Ukraine will be seriously impacted. Consumption demand, which has been a concern as the pandemic dented consumer finances and confidence, grew by 8.6% (YoY) - an enormous boost for the Indian economy. However, consumer spending lagged substantially from the pre-COVID-19 levels, suggesting that pandemic uncertainties are still weighing on consumers confidence and ability to spend.

Agriculture and other related industries were the least affected during the pandemic. Strong sowing progress and abundant harvest increased output. Moreover, the rise in MSPs along with improvement in rice procurement augmented rural earnings.


According to the IMF, Indias prospects for 2023 are marked up on expected improvements to credit growth and, subsequently, investment and consumption, building on better-than- anticipated performance of the financial sector. The GDP is expected to grow in real terms by 8% to 8.5% in 2022-23. The industry expects the coming year to see an increase in private sector investment with the financial system in sturdy shape to support the countrys economic recovery. This projection is in line with the World Banks and Asian Development Banks recent predictions of 8.7% and 7.5% real GDP growth for FY23, respectively.

However, concerns surrounding the slow government spending to consolidate its expenses may pose a threat. India currently has the highest fiscal deficit among its peer nations and debt is at an all-time high. With the economy gradually coming out of the pandemics shadow and showing signs of a steady recovery, pent-up demand will probably sustain the growth momentum. This shows there is probably a lesser need for a stimulus package from the government. Besides, the government would like to build its capacity to respond to future adversities in case they arise. Another risk to the economy is the rising inflation rates. Recent spikes in inflation have concerned policymakers as pent-up demand rose faster than supply.


Backbone of the Indian economy, the Indian agriculture industry is the livelihood of over 50% of the nations population. Over 54% of the nations land categorized as arable. Amongst one of the leading producers of different agricultural commodities in terms of volume, such as rice, wheat, cotton, sugar, horticulture, and dairy, among others, the Indian agriculture industry and related sectors today contributes nearly 19%.

During the covid period, while most of the other industries witnessed a de-growth, the Indian agriculture industry was one of the few industries which witnessed positive growth despite the challenges.

Valued at around 71,220 billion at the end of 2021, the market value of the Indian agriculture and allied industry is expected to reach a value of 142,280 billion by 2027, exhibiting a CAGR of 12.3% during the period.

Poised for strong growth, the Indian agricultural sector grew at a healthy 4.1% rate in the fourth quarter of FY22 (at constant prices), up from 2.8% during the corresponding period of the previous year. However, for the full year i.e. FY22, gross value added (GVA) for agricultural sector is expected to be marginally less than FY21 at 3% because of a drop in wheat production. The Indian agricultural sector has undergone several transformations over the past few decades. These include - rising penetration of the organized sector, growth in contract farming, agriculture becoming more mechanized, easy loan facilities, rise of exports, use of agrochemicals and high yielding seeds, and an increasing role of the private sector in processing, branding and marketing, etc.


Instability : Agriculture in India is largely dependent on the monsoon. As a result, production of food-grains fluctuate year after year. A year of abundant output is often followed by a year of acute shortage in key crops.

Cropping pattern: The crops that are grown in India are divided into two broad categories: food crops and non-food crops. While the former comprises food-grains, sugarcane, cereals, pulses, coarse grains and other beverages, the latter includes different kinds of fibres and oilseeds.

Sub-Division and fragmentation of holding: Due to the growth of population and breakdown of the joint family system, there has occurred continuous sub-division of agricultural land into smaller and smaller plots. At times, small farmers are forced to sell a portion of their land to repay debt. This creates further sub-division of land.

Conditions of agricultural labourers:

The conditions of most agricultural labourers in India are far from satisfactory. There is also the problem of surplus labour or disguised unemployment. This pushes the wage rates below the subsistence levels.

Manures, fertilizers and biocides: Indian soil has been used for growing crops over thousands of years without caring much for replenishing. This has led to depletion and exhaustion of soils, resulting in their low productivity. The average yields of almost all the crops are among the lowest in the world. This is a serious problem which can be solved by using more manures and fertilizers.

Irrigation: Although India is the second largest irrigated country of the world after China, only one-third of the cropped area is under irrigation. Irrigation is the most important agricultural input in a tropical monsoon country like India where rainfall can be uncertain, unreliable and erratic.

Lack of mechanisation: In spite of the large- scale mechanisation of agriculture in some parts of the country, most of the agricultural operations in larger parts are carried on by human hand using simple and conventional tools and implements like wooden plough, sickle etc.

Agricultural marketing:

Agricultural marketing still continues to lag in rural India. In the absence of sound marketing facilities, the farmers have to depend upon local traders and middlemen for the disposal of their farm produce which is sold at throwaway price.

Inadequate transport: One of the main handicaps with Indian agriculture is the lack of cheap and efficient means of transportation. Even at present there are lacs of villages which are not well connected with main roads or with market centres.


Indias agricultural exports touched a new milestone in FY22 as the overall exports touched the $50 billion mark, the highest level ever achieved for agriculture exports. According to the data published by the Directorate General of Commercial Intelligence and Statistics (DGCI&S), Government of India, Indias agricultural exports have grown by 18% during 2021-22 to touch $49.6 billion marking a growth of 19% at $41.87 billion achieved in 2020-21. This growth is remarkable considering the unprecedented logistical challenges in the form of high freight rates and container shortages, faced by the industry in the recent years. Key export products from

India included rice, meat, grains, wheat, nuts, onions, fruits, pulses, dairy products, alcoholic beverages, cereals, cashews and vegetables. Further, the export of marine products also reached the highest ever at $7.71 billion in FY22 and spices exports have touched $4 billion for the second year in a row. Wheat has recorded an unprecedented growth of more than 273%, jumping nearly four-fold from $568 million in 2020-21 to touch close to $2119 million in 2021-22.


In FY23, the budget for agriculture and the allied sector stood at Rs.1,51,521 crores, which is 3.84% of whole budget allocation. However, it is lesser in comparison to that of 3.92% in FY22. Of this allocation, cash-based agricultural schemes received almost 79% allocation, leaving only about 21 % expenditure for core schemes. The cash-based schemes primarily include

Pradhan Mantri Kisan Samman Nidhi (PMKISAN), Market Intervention Scheme and Price Support Scheme, Pradhan Mantri Fasal Bima Yojana (PMFBY), Modified Interest Subvention Scheme, and Pradhan Mantri Kisan Man Dhan Yojana. On the other hand, the major core interventions receiving mere 21% of allocated outlay chiefly cover, soil health improvement, development of community-based assets like augmentation of water resources, quality research, quality seeds availability, mechanization techniques soil testing labs and handholding support through extension services.



Rice is one of the three major crops cultivated worldwide, along with wheat and corn. However, rice is the most important crop that is used as a primary food source. In developing countries, the availability of rice is closely tied to the food security and political stability. Feeding more than half of the global population, just 10 countries produce nearly 84% of the global rice requirement. The most important crop to millions of small farmers across the globe, globally over 700 million tons of rice (470 million tons of milled rice) is produced annually and nearly 90% of the production comes from Asia.

Annual global rice production in the 2021-22 rice sowing season S is expected to be around 510.8 million tons (milled basis), down 0.9 million tons from the previous forecast but 3.6 million tons higher than last years production. Global rice consumption in the 2021-22 season is expected to be around 510.9 million tons, down almost 0.4 million tons from the previous forecast, but nearly 8.9 million tons higher than the previous year.


Thanks to the favourable climatic conditions prevailing in India, over the years, the nation has emerged as the second largest rice-growing country worldwide. It doesnt matter how its cooked - steamed, boiled or fried - rice is included in pretty much every meal of the day in India. Today, India produces more than 20% of the global rice requirement from its 47 million hectares of rice plantation area - only 2.4% of the global land.

Grown across India, different rice varieties are grown at different time of the year. However, the majority of the rice produced in India is during the Kharif season (the Kharif season in India starts from June and ends in September during the southwest monsoon). Eastern, North-eastern and Southern India are major rice-producing region because of a conducive climate throughout the year. Despite being the staple food for majority of the Indians, the rice industry is still largely dominated by unorganised players owing to the easy availability of rice from a large number of local stores (both retailer and smalltime dealers).

But in the recent years, the organised and packed rice segment has gained traction thanks to Indias growing middle-class population coupled with the increasing consumer consciousness towards food safety and quality. Moreover, the rising penetration of organized food retail outlets offering different varieties of packaged rice is further catalyzing the market growth in the country. Additionally, the shifting consumer preferences towards an energy-rich, carbohydrate-based diet for reducing the risk of numerous chronic ailments, are also propelling the product demand. Apart from this, elevating consumer living standards, particularly across Tier 1 and Tier 2 cities, are further bolstering the sale of premium and specialty packaged rice products. Moreover, the expanding HoReCa sector, along with the growing prominence of high-grade packaged rice with sleek grains, unique aroma and taste, prolonged shelf-life, etc., is positively influencing the regional market.

Further, the implementation of various government initiatives, such as the National Food Security Mission (NFSM), for boosting domestic production and improving the storage capacity of rice in India is acting as another growth- inducing factor for the organised segment. Moreover, several key players have launched innovative packaging solutions in the form of zip lock pouches and flexible pouches for convenient usage and easy storage, which is further expected to India the packaged rice market in India in the coming years. Reaching a volume of 10.96 million tons in 2021, the Indian packaged rice industry is expected to reach a volume of 15.33 million tons by 2027 after growing at a CAGR of 6.10%.

In a bid to aid the rice farmers of India, the government has periodically increased MSP and as a result, the MSP almost doubled in the last decade. The government announced the MSP at 1,940 per quintal for common paddy and 1,960 for Grade-A paddy for the marketing year 2021-22.


India is one of the major rice exporters of the world and meets nearly 25% of the global rice demand. Although basmati rice dominates the Indian rice export but in the last few years non- basmati rice has gained traction in the international market. According to the data published by the DGCIS, the Government of India, India registered a 27% growth in export of non-basmati rice to touch $6.12 billion in 2021-22 compared to $4.8 billion in 202021 and $2.01 billion in 2019-20. Indias non-basmati rice exports have gone up by 109% from $2.92 billion in 2013-14.

But for the third consecutive year, exports of Basmati rice saw a fall over the previous year in value terms. In 2021-22, India exported 3.53 billion dollars worth of Basmati rice, the lowest since 2019-20. According to the experts, one of the key reasons for the decline is the loss of the traditional market of Iran because of the US sanctions.


From risotto to Iranian pulao, Indian Basmati has been an essential part of recipes savoured in different parts of the world for ages. The aromatic long grain rice, also known as the Basmati rice, is a pride rice for India and is popular owing to its long grains, distinctive texture, and rich fragrance.

Grown in specific agro-climatic condition with specific geographical area, plant nutrition, agronomic practices, and method of harvesting, processing, and aging attributes. This makes Basmati rice special, as it is grown only in a specific region of India and Pakistan. Despite its popularity, basmati rice is not easy to come by outside of its native region. The grain is delicate and requires a specific climate to grow properly. As a result, basmati rice is expensive and difficult to find in most parts of the world.

Basmati is unique to the region. It can be grown where precise climatic conditions, soil quality and temperature exist and this only occurs in the Indo- Gangetic area of the Himalayas. Grown in the specific regions in India such as Himachal Pradesh, Jammu & Kashmir, Haryana, Punjab, western Uttar Pradesh, Uttarakhand, and Delhi, India has helped popularise the Basmati rice across the globe. India is the main exporter of basmati rice to the international markets. India exports basmati rice in the world to Iran, Saudi Arabia, Iraq, UAE, Kuwait, Iraq, the UK, Yemen Republic, USA, Canada, and Oman.


Established in 1989, KRBL Limited is Indias oldest and only integrated packaged rice manufacturer. Backed by state-of-the-art manufacturing and packaging facilities, KRBL is one of the largest exporters of Basmati rice from India. With the largest milling capacity in the world, the Company has in place state-of-the-art grading and polishing stations, which are supported by a strong and well-spread procurement network across Punjab, Haryana, Uttaranchal and Uttar Pradesh.

Known for globally renowned brands - India Gate, Unity and Nur Jahan KRBL - has marked its presence across the entire value-chain of the rice industry. Today, KRBLs flagship brand India Gate is synonymous with the best quality Basmati rice not only in India but also abroad. Over the years, India Gate has emerged as the most preferred packaged rice brand in many countries, including India. The Company has built a distinct and tailored rice-based product range over the years and today has product presence in more than 90 countries across the globe. Serving both retail and institutional clients across the globe, KRBLs commitment to quality has helped it earn enormous respect and recognition within the global rice industry.

Further, the Company has in place a state- of-the-art research and development (R&D) unit. The R&D unit brings together a team of experienced rice professionals and farmers, with an aim of blending the wealth of traditional knowledge with modern know-how and technology to improve pre & post harvesting techniques. The key aim of the R&D unit is to boost quality, improve head rice yields and lower costs. The Companys research efforts have a direct bearing on the success in developing new seed varieties in collaboration with agriresearch institutes and its ability to source and adapt the worlds frontline rice making technologies to conditions prevailing in India.


Grow and strengthen network advantage

Deliver operational and organisational efficiencies

Disciplined allocation of capital and improved cash flow generation

Innovate offerings and services to create new value

Build a talented workforce


Research - Utilise insights and expertise of the rice industry to develop new value-added products and widen customer base

Market leadership - The Company is a market leader in most markets where it seeks to build on this leadership by innovating its portfolio and by catering to the evolving needs of the consumers.

Product portfolio -

The product portfolio comprises both standard and niche products assuring integration and synergy in operating facilities.

Focused value-addition

- The Company is an established player in the rice industry but in the last few years, the Company focused on widening its presence in the value- added segment by foraying in the rice-based new product segments such as healthy food segment.

Synergies - The Company lays great emphasis on synergies, which has augmented its quest for global leadership and helps to keep its competitive advantage.

Strong customer base -

The Company has a strong customer base (both retail and institutional clients) spread across the globe. Several of these customers have been with the Company for over 25 years and have long-term and strong relationships with them.

Further, the company is also engaged in the business of power generation from renewable sources. Part of the power generated is utilised for captive consumption and rest is sold to the state distribution companies.


Installed Power Generation Capacity

Particulars 2021-22
Total Wind power project capacity 112.25 MW
Total Solar power project capacity 17.00 MW
Total Biomass capacity 17.59 MW


Details of Project

Details of Units Generated

2020-21 2021-22
Dhule (1.25 MW*10) 1,10,85,442 1,47,67,412
Sangli (2.10 MW*09) 3,38,13,156 3,43,14,048
Tamil Nadu
Tirupur (1.50 MW*4) 1,07,90,870 1,12,13,245
Tirunelveli (2.10MW*1) 30,05,417 32,58,089
Raichur & Koppal (1.50MW*6) 1,91,47,060 1,91,02,438
Bellary (2.10MW*1) 36,87,382 36,08,824
Jodhpur (1.50MW*4) 86,99,090 87,62,207
Jaisalmer (2.10MW*1) 26,40,656 33,06,886
Jodhpur (1.25MW*3) 48,43,949 50,29,767
Andhra Pradesh
Kaddappa (2.10MW*1) 33,91,280 38,15,434
Anantapuram (2.10MW*4) 1,26,83,501 1,38,02,620
Madhya Pradesh
Agar-Malwa (1.50MW*4) 87,08,281 1,00,96,595
Mandsaur (1.50MW*4) 69,25,367 80,88,260


Details of Project

Details of Units Generated

2020-21 2021-22
Devbhoomi Dwarka (2.10MW*13) 5,74,67,780 6,82,77,316
Sub Total (A) 18,68,89,231 20,74,43,141
Madhya Pradesh
Rajgarh (2.50MW) 38,70,865 36,84,722
Agar-Malwa (6.63MW) 1,05,46,109 99,35,303
Agar Malwa (5.60MW) 87,60,857 83,00,281
Sehore (0.27MW) 3,77,695 3,61,224
Siwani (2 MW) 14,94,831 26,10,359
Sub Total (B) 2,50,50,357 2,48,91,889
TOTAL(A+B) 21,19,39,588 23,23,35,030

Power Business

Plant Location Function Capacity (MW)
Dhuri Biomass 12.34
Gautam Budh Nagar Biomass 5.25
Sub-Total (A) Biomass 17.59
Maharashtra Wind 31.40
Rajasthan Wind 11.85
Tamil Nadu Wind 8.10
Karnataka Wind 11.10
Andhra Pradesh Wind 10.50
Madhya Pradesh Wind 12.00
Gujarat Wind 27.30
Sub-Total (B) Wind 112.25
Madhya Pradesh Solar 15.00
Haryana Solar 2.00
Sub-Total (C) Solar 17.00
Total (A+B+C) Biomass / Wind / Solar 146.84


Realising that research and development is a key enabler of growth, KRBL embarked on the path developing an in-house research and development department. Over the years the department has ensured, through new product development and launches, KRBL continuously kept addressing the changing needs of its wider customer base. Further new product launches contributed to the efficiency and sustainability of product portfolio and improves profitability.

Known today for pioneering several cropping methodologies and harvesting techniques, KRBLs R&D team over the years have enormously helped the farmers to enhance their yield. Collaborating with some of the renowned agricultural academic/ research institutions of the nation, the core focus of KRBLs R&D unit is to develop new Basmati seed varieties which are of superior quality. With a keen eye on continuously upgrading the seed quality, KRBLs R&D team works closely with the Indian Agriculture Research Institute (IARI), New Delhi to develop new and improved seed varieties.


KRBL pioneered the development and use of premium PUSA 1121 Basmati seed variety. This variety is considered superior than the Pakistan Basmati seed variant.


The company recorded total income of 4,25,327 lacs, higher by 6% as compared to the previous year. Revenue from operations increased by 5% while Other Income increased by 88%. EBIDTA of the company stood at 70,475 lacs as compared to 84,490 lacs in FY 21 - EBIDTA Margin is lower by 4% owing higher paddy price in the 2021 season, change in sales mix and higher logistic costs besides higher marketing expenses.

A. Summary of Consolidated Income Statement

Rs. in lacs
Description FY22 FY21
Revenue from Operations 4,21,056 3,99,188
Other Income 4,271 2,268
Total Income 4,25,327 4,01,456
Material Cost 3,06,177 2,75,896
Material Cost / Total Income (%) 72% 69%
Gross Profit 1,19,150 1,25,560
Gross Profit Margin (%) 28% 31%
Employee Benefit Expenses 10,444 9,221
Depreciation & Amortization Expense 7,422 7,195
Other Expenses 38,231 31,849
Total Expenses 3,62,274 3,24,161
Total Expenses / Total Income (%) 85% 81%
EBITDA 70,475 84,490
EBITDA Margin (%) 17% 21%
Finance Cost 1,340 2,359
Profit Before Tax 61,713 74,936
PBT Margin (%) 15% 19%
Tax Expense
Current Taxation 16,567 19,824
Deferred Taxation (794) (779)
Net Profit after Tax 45,940 55,891
Other Comprehensive income/ (expenses) 71 596
Total Comprehensive Income 46,011 56,487
Comprehensive Net Profit/Total Income (%) 11% 14%

Share of domestic sales in Revenue from Operations increased to 63% in FY22 as against 50% in preceding year. The Company recorded the highest ever-domestic revenue in FY22.

Rs. in lacs
Description FY22 FY21
Agri Segment
- Export Sales 1,45,119 1,89,667
- Domestic Sales 2,64,783 2,00,225
Power Segment 11,154 9,296
Total 4,21,056 3,99,188

The companys Net Profit stood at 45,940 lacs during the year, reflecting the year-on-year trend in EBITDA.

Description FY22 FY21
Operating profit margin (%) 14.98 19.36
Net profit margin (%) 10.80 13.92
Return on net worth (%)1 11.84 16.39
Return on Capital Employed (%) 14.51 18.40

Inventory levels continue to reflect the companys strategy of ageing rice. The overall working capital position remains healthy.

Rs. in lacs
Description FY22 FY21
Inventory 2,81,610 2,96,421
Trade Receivable 28,934 20,129
Trade Payable 18,057 21,906
Inventory turnover ratio2 2.09 1.99
Debtor turnover ratio 17.16 18.50

Total borrowings of KRBL as of 31 March 2022 stood at 8,939 lacs vis-a-vis 30,780 lacs as on 31 March 2021. The company continues to be debt free on Net Bank Debt (39,021 lacs) basis.

Description FY22 FY21
Debt Equity ratio3 0.04 0.09
Current ratio4 7.38 4.68
Interest Coverage ratio5 47.05 32.77

1. The Return on Net Worth came down from 16% to 12% as the Net Profit declined from 56,487 lacs to 46,012 lacs.

2. As Basmati paddy crop season is from October to December, closing inventory as on 30th September has been considered for calculating Inventory turnover ratio.

3. Debt equity ratio of the Company improved from 0.09 times as of March 31,2021 to 0.04 times as at 31st March 2022 on account of reduction in borrowings from 30,780 lacs to 8,939 lacs in the same period.

4. Current ratio of the Company improved by 58% during the year, from 4.68 to 7.38, owing to reduction in current liabilities by more than 24,139 lacs.

5. Interest Coverage ratio improved by 44% during the year from 32.77 to 47.05 owing to reduction in finance cost from 2,359 lacs to 1,340 lacs.

Formula used for calculation of the ratios

Operating profit margin (%) Profit before interest, taxes and exceptional items/Revenue from operations
Net profit margin (%) Profit after tax/Revenue from operations
Return on net worth (%) Profit after tax/Average Equity
Return on capital employed (%) Profit before interest, taxes and exceptional items/ (Total Equity + Borrowings + Lease liability + Deferred tax liability)
Inventory turnover ratio Net sales/Average of opening and closing inventories
Debtors turnover ratio Net sales/Average of opening and closing trade receivables
Debt equity ratio Debt (Borrowing and lease liability)/Equity
Current ratio Current assets/Current liabilities
Interest coverage ratio Profit before interest, taxes/Finance costs


At KRBL, we emphasise on establishing a comprehensive risk management system to facilitate our objectives, ensuring that risks that could have an impact on the organisation and its sustainability are identified, analysed, assessed, managed and controlled.

Risk Management is process driven by the Companys senior management, assisted by different committees, who regularly review and monitor the risks and the management process in accordance with the governance requirements.

Our risk management process aims to support the delivery of KRBLs strategy by managing the risk.

A slowdown in the global rice industry may negatively impact the performance of the company.

Risk Mitigation

• The staple crop for over 50% of the global population, rice demand is expected to continue to rise with growing population. Further, food security concerns all over the world are likely to drive growth of the global and Indian rice industry.

• Several subsidy and export incentives are being given by the Central and State governments to reward the rice producers and exporters.

• The global rice market is expected to reach USD 334.24 billion by 2028, registering a CAGR of 2.2% in between 2022 to 2028.

Unfavourable government regulations, in the different countries where KRBL exports its products, could impact the Companys growth. Also, noncompliance with local laws and regulations may result in penalties being levied.

Risk Mitigation

• Every product manufactured by the Company is passed through extensive R&D checks and stringent quality control tests as per international norms.

• All manufacturing units of the company are in 100% conformance with the guidelines issued by the different regulatory bodies.

• The Company regularly invests in plant automation and R&D which has helped the Company meet its regulatory compliances.

• The Company recently introduced new seed varieties which have

a higher resistance against pest attacks and climatic aberrations, resulting in lower usage of pesticides and chemicals. Thereby, ensuring a higher acceptability of products in the international markets.


Rice production can be threatened by adverse climatic conditions or crop switchover. A decline in rice production can affect the profitability as it may lead to a rise in the cost of raw material or higher procurement cost.

Risk Mitigation

• KRBLs manufacturing units are located in close proximity to some of the largest rice producing states of India.

• KRBL has built a widespread farmer network with over 95,000 farmers and spread over 250,000 acres of land. The Company has developed multi-decadal relationship with its farmer community, thus supporting a regular and timely supply of quality raw material.

• The Company trains farmers extensively in rice seed selection, procurement and latest farming techniques to counter probable climatic impact. The Company provides high yielding seed varieties to farmers, enhancing rice production and growth.

• Further, the Company conducts periodical field surveys, helps the farmers with best practices to protect their fields, undertakes detailed research analysis and monitoring of market before procuring the paddy, and deploys field purchasers to check all quality parameters to ensure quality consistency.

Higher dependency on any one country may cause a dip in profitability

Risk Mitigation

• KRBL has product presence in over 90 countries across the world.

• KRBL commands a high market share in two of the largest rice markets in the Middle-East region.

• The Company deepened its presence in select countries with an objective to graduate from mere shop share to national share. This multi-country presence is likely to moderate the risks arising from geopolitical instability in select regions.

High concentration on any one product, specially in the rice trade, may adversely impact revenues and profitability

Risk Mitigation

• KRBL has several market leading brands under its banner.

• The Company has undertaken related product diversification strategy such as foraying into the FMCG segment with ready- to-eat products and health food portfolio, to minimize product concentration risk.

• The Company has also developed additional revenue generating streams such as energy as well as the solvent plant and furfural oil. Additionally, we are exploring new opportunities for further related diversification.

The Company operates in a competitive environment and, as such, may experience increased competition that could adversely affect KRBLs sales, operating margins and market share.

Risk Mitigation

• KRBL has a continued focus on its operating performance from manufacturing to R&D to distribution to ensure that it continues to service the needs of its customers efficiently and in a timely manner.

• Enhanced focus on a 3600 brand building exercise comprising successful brand promotions and engaging customers at multiple points, resulting in an integrated communication approach.

• Diversifying into the related product category to enhance its kitchen share and maintain its leadership position in the key markets.

• Attractive price-value propositions helping the Company in creating new product categories.

• The Company focused on a greater usage of customer data, to analyze the customer need and shopping patter, thus plan better in terms of showcasing the right product to the right customer at the right price in the right market.

The Company is exposed to foreign currency risk arising primarily owing to its business presence in a number of foreign countries.

Risk Mitigation

• The Company has in place a well thought- out and well-structured foreign exchange risk management policy, which safeguards the Company from any unwanted foreign currency fluctuations by competently hedging all the foreign currency exposures.

• Open unhedged positions are regularly reported to the senior management of Company to take a conscious and information induced future course of action.

Inability to attract and retain talent could adversely impact the companys growth.

Risk Mitigation

• KRBL invests in hiring organisation-fit talent, talent development and employee engagement. This helps provide fulfilling careers at KRBL.

• The Company enhanced its robust talent value proposition as one of the transformational areas to drive sustainable growth.


At KRBL, core part of our business strategy is to provide an environment where all of our employees feel enabled, empowered, and committed. Our HR practices are aligned with industry best practices and have created a talent base, which helps us reinforce leadership across countries. These practices enable us to seamlessly integrate professionals from different socio-economic backgrounds, countries and culture and invest in their formal and informal training. The Company is focusing on diversity hiring and on boarding new talent from top FMCG Organizations.

During the reporting year, KRBL strived to strengthen its employee engagement across levels by providing an enriching work environment, undertook HR transformation projects at various levels and maintained an ongoing dialogue with our people.

It prioritised employee safety amidst the pandemic, providing support to the employees.

KRBL believes that its people are fundamental to great products, service and a companys reputation, therefore, it is a constant endeavour to build strong teams of passionate, dedicated and highly skilled workforce, both at corporate and plant level. The Company constantly introduces better systems and processes to enhance employee productivity.

KRBL has been working towards developing, grooming and training its employees for next level roles. It is inducting high-calibre talent to ensure that the company has the right people, teams and skills to grow its business. Its HR approach is to ensure overall growth of an employee. KRBL strives to ensures that its employees are well rounded, feel safe in the working environment, are motivated and productive in their personal and professional lives.

The Companys total employee strength as on 31st March, 2022 stood at 2,321.


Information technology (IT) has been an integral part of the process of the Company and has been one of the key driving forces behind the growth achieved by KRBL. Effective management of the Companys vast network of distribution channels is facilitated by its use of top-of-the-line technology. We are thus consistently scaling up our IT investments to upgrade our technological processes and evolve an infrastructure & IT security capable of maximising the potential of the countless growth opportunities in the digital universe.

The Company uses SAP to manage employee and distributor data, which also allows it to track information flows in real time at the distributor and sub-distributor level. This has greatly improved qualitative control and strengthened supply chain efficiencies. Further, processes have been standardised across the board in order to ensure streamlining of systems across the operational value chain. The Company is also investing heavily in data analytics to optimise its sales and distribution strategy.


The Company puts the highest priority on transparency, ethics and good corporate governance and has established strong internal controls which have been integral to its growth process. It maintains proper accounting control and monitoring of operational efficiency; its policies ensure strict compliance with laws and it works towards maintaining reliable financial and operational information. KRBLs Audit Committee is consistent in its periodic review of all audit reports, audit plans, audit findings of note, adequacy of internal controls and compliance with Indian Accounting Standards (Ind AS). Over and above this, the Audit Committee proposes improvements when necessary.


Readers are advised to kindly note that the above discussion contains statements about risks, concerns, opportunities, among others, which are valid only at the time of making the statements. A variety of factors known or unknown, expected or otherwise, may influence the financial results. These statements are not expected to be updated or revised to take care of any changes in the underlying presumptions. Readers may therefore appreciate the context in which these statements are made before making use of the same.