Thursday, July 5, 2012

Govt abolishes basmati rice MEP, stocks soar

Shares of basmati rice exporters such as LT Foods, KRBL and Kohinoor Foods have rallied more than 10% each, after the government scrapped the minimum export price (MEP) on basmati rice to boost exports.

"Basmati rice can be exported without any MEP," according to a notification by the directorate general of foreign trade, a PTI report suggests.

Earlier this year, the government had lowered MEP on basmati rice to $ 700 a tonne from $900 a tonne to make it more competitive in the global market, the report added.

Among the individual stocks, KRBL has rallied 19% to Rs 24.50, followed by Kohinoor Foods (up 17%) and LT Foods (up 11%) on the Bombay Stock exchange.

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