This smallcap agricultural products stock has zoomed 49% in 1 month

Kaveri Seed share price surged 18% in 3 days after private weather forecasting agency Skymet said that the southwest monsoon is expected to be 'Normal' this year at 103% of the Long Period Average.

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Kaveri Seed Company share price hit a record high at ₹ 1,552.50, soaring 9 per cent on the BSE in Tuesday’s intra-day trade. The stock price of smallcap agricultural products company was quoting higher for the third straight trading day, surging 18 per cent during this period. The up move in stock price of the company came after private weather forecasting agency Skymet said that the southwest monsoon is expected to be ‘normal’ this year at 103 per cent of the Long Period Average (LPA).

 

The LPA for the June-September monsoon months is 868.6 millimeters, according to Skymet. Rainfall between 96 and 104 of the LPA is considered ‘normal’.

 

Kaveri Seed Company has only one business segment i.e, sale of seeds. In the past one month the stock has rallied 49 per cent, as compared to 3.4 per cent rise in the BSE Sensex.

 

Since February 14, Kaveri Seed Company has seen its market price zoom 67 per cent after the company reported a good set of numbers for the quarter ended December 2024 (Q3FY25). The company’s profit after tax jumped 29 per cent year-on-year (YoY) at ₹ 15.04 crore, on the back of 30.6 per cent YoY rise in revenue from operations at ₹ 154.77 crore.

 

The management said rice and maize continued to do well during the quarter. Increase in volumes in both selection, hybrid rice and maize has resulted in good growth rates on account of good realization and passing of increased production costs.

 

Hybrid rice volumes increased by 14 per cent and revenues by 27 per cent. Selection rice volumes increased by 18 per cent and revenue increased by 34 per cent. Maize volumes increased by 8 per cent and revenues increased by 25 per cent. The volumes of cotton hybrid was decreased by 35 per cent and revenues decreased by 27 per cent. The contribution of new products to volumes of Bajra was up from 60 per cent to 70 per cent, the company said.

 

India has one of the largest seed markets in the world. This is due to the country's diverse agro-climatic zones and extensive farming activities. The Indian seed industry has reached a size of $ 3.61 billion in 2024 and is estimated to reach $ 5.01 billion by 2030. This exhibits a growth rate (CAGR) of 5.58 per cent during 2024-2030.

 

Going forward, the Indian seed industry is expected to witness further growth with an emphasis on sustainable practices and technological innovation. With continued focus on R&D and the gradual acceptance of biotech crops, the industry is expected to drive future expansions. Moreover, many initiatives aimed at enhancing seed distribution and farmer outreach will play a crucial role in ensuring that the benefits of high-quality seeds reach all corners of the agricultural community, the company said.

 

Initiatives like the Integrated Scheme for Oilseeds, Pulses, Oil Palm and Maize (ISOPOM) and the Rashtriya Krishi Vikas Yojana, provide essential support. These programmes encourage research and the adoption of advanced agricultural practices and create a supportive environment for the seed industry, the company said in the FY24 annual report.