Kohinoor Foods, LT Foods, KRBL: Rice exporter shares fall as US, Israel attack on Iran intensifies

Shares of Indian basmati rice exporting companies like KRBL, Kohinoor Foods and LT Foods dropped up to 10.5% on Monday, March 2, after United States and Israel launched an attack on Iran over the weekend. Iran is a major consumer of Indian Basmati rice.

Shares of popular India Gate rice producer KRBL dropped as much as 5.50% to hit an intraday low of ₹320.95, shares of Dawat rice producer LT Foods fell as much as 10.51% to hit an intraday low of ₹360 and producer of Kohinoor basmati rice Kohinoor Foods declined as much as 7% to hit an intraday ow of ₹23.31.

Iran is a major market for Indian basmati rice, importing approximately 1 million tonnes in the 2024-25 fiscal year, valued at roughly $698 million to $1.2 billion, as per data compiled by Trading Economics.

Geopolitical tensions in the Middle East escalated sharply from Saturday following coordinated military strikes involving the United States and Israel against Iran, raising fears of a broader regional conflict.

The strikes led to the killing of Iran's Supreme Leader Ayatollah Ali Khamenei, escalating geopolitical tensions and deepening global economic uncertainty.

Israel launched a new wave of strikes on Tehran on Sunday, and Iran responded with more missile barrages, a day after the killing of Khamenei pitched the Middle East and the global economy into deepening uncertainty.

Meanwhile, rice exporters are staring at payment delays and disruptions to shipments headed to Iran following the US and Israeli military strikes on Iran.

The shipments which were headed to Iran or even to Afghanistan via Iran's biggest port, Bandar Abbas, have been held up. "These shipments will remain stuck till the situation improves, and it will impact the market. Payments may also get delayed," Jain added.

As of 11:24 am, KRBK shares traded 2.36% lower, LT Foods declined 3.84% and Kohinoor Foods was down 2.6%.