Export ban, duties to weigh on rice mill stocks in near-term, say analysts

Shares of rice mill companies have underperformed the benchmark indices, so far this month, as the government banned exports of broken rice and slapped 20 per cent export duties on various grades of rice. Shares of LT Foods, Kohinoor Foods, KRBL, Chaman Lal Setia Exports, for instance, have declined in the range of 2 per cent to 9 per cent, as against 0.4 per cent gain in the Nifty50 index.

Though analysts foresee the government's protectionist measures to hurt companies in the near-term; good rice production and sound fundamentals are expected to override negative sentiments in the long-term, they said.