Shares of KRBL Ltd, known for its India Gate Basmati rice, rose up to 8% in trade on Monday, while LT Foods Ltd, known for its Daawat brand, rose up to 10%. The rise in these stocks was due to the government's announcement of removal of minimum export price (MEP) on Basmati rice in view of adequate stocks and current trade concerns. Shares of rice companies, including Chaman Lal Setia Exports, jumped in today's trade.

Under the earlier restrictions, Basmati rice could only be exported above a set floor price, CNBC TV18 reported. The government had last year revised the MEP from $1,200 per tonne to $950 per tonne. Now, the government has completely abolished the MEP.

Exporters are seeing a rising demand for Basmati rice and this move may help stabilize Basmati rice prices, which were on a decline recently due to some global orders. However, such a move is only emotionally positive for these companies, as they have clarified in previous earnings calls that the average realization for Basmati rice exports is already higher than the minimum export price. Hence, there was no impact of MEP restrictions on them.

KRBL shares are currently trading 5.64% higher at ₹ 321.35 at around 1.30 pm. It has gained nearly 10 per cent in a month, whereas, the stock has declined over 14% so far in the year 2024.

LT Foods shares were currently trading 7% higher at ₹436. The stock has been outperforming among its peers so far. Its price has more than doubled this year with a gain of over 114%. On the other hand, Chaman Lal Setia Exports shares are off the day's high, currently trading 1.7% higher at ₹234.35. Like KRBL, the stock is also down 8% so far in 2024.