5,500 per cent multibagger returns: Rice manufacturing stock in focus on easing rice export limits, bagged an order & expansion plans; details inside!

The stock gave multibagger returns of 1,465 per cent in 5 years and a whopping 5,500 per cent over a decade.

India, a major rice exporter, is considering relaxing restrictions on some rice varieties due to concerns about a domestic surplus before the next harvest. This potential policy change comes after export limitations imposed in July 2023 caused rice prices in Asia to surge. The government might allow white rice exports with a fixed duty and eliminate the 20 per cent tax on parboiled rice exports, potentially replacing it with a set levy. This could bring relief to countries in West Africa and the Middle East that depend heavily on Indian rice imports, and also help cool down the currently high rice prices in Asia. The decision comes as Indian farmers are currently planting their rice crop, with harvest expected from late September onwards.

Additionally, GRM Overseas Ltd secured Rs 136.5 crore in funding by issuing convertible warrants to 33 investors, including promoters and non-promoters. This capital will be used to expand their "10X" brand in India, improve operational efficiency, and pursue strategic acquisitions in the food FMCG sector.

Earlier, GRM Overseas Ltd partnered with DIPLOMAT GEORGIA to distribute their ‘Tanoush’ brand of basmati rice in Georgia. This two-year exclusive deal will see ‘Tanoush’ basmati rice offered in 1 kg, 5 kg, and 20 kg pack sizes through DIPLOMAT’s distribution channels. This agreement expands GRM’s reach into Georgia and leverages Diplomat Group’s established presence in the region, which also includes Israel, Cyprus, and New Zealand.

Furthermore, the company secured a significant new order valued at Rs 600 million from Bin Awadh Alnaqeeb Group, the largest importer of Indian basmati rice in Yemen. This marks the biggest order ever received by GRM Overseas from the Yemeni importer and distributor, signifying a continued flow of high-value business between the two parties. The agreement entails GRM Overseas supplying Indian basmati rice to Bin Awadh Alnaqeeb Group, further strengthening GRM's presence in the Middle Eastern market, a key region for their business.

About the Company

GRM Overseas Ltd, a leading Indian company in the basmati rice industry, mills, processes, and markets both branded (like their 10X brand) and non-branded basmati rice for both domestic consumption and international export. Their product range goes beyond just basmati rice, also including atta flour (Shakti Chakki Fresh) and ready-to-cook biryani kits in various regional styles like Moradabadi, Hyderabadi, and Lucknowi.

Today, shares of GRM Overseas Ltd gained 1.41 per cent to Rs 214 per share from its previous closing of Rs 211.10. The stock’s 52-week high is Rs 231.35 while its 52-week low is Rs 114.15. The company has a market cap of over Rs 1,200 crore.

As of March 2024, the company's promoters increased their stake to 72.16 per cent and FIIs increased their stake to 0.26 per cent compared to 71.72 per cent and 0.07 per cent in March 2023. The shares of the company have an ROE of 21 per cent and an ROCE of 15 per cent. The stock gave multibagger returns of 1,465 per cent in 5 years and a whopping 5,500 per cent over a decade. Investors should keep an eye on this small-cap stock.

Disclaimer: The article is for informational purposes only and not investment advice. 

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