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Amritsar rice agent Raghunath Arora built Rs 4,686 cr Daawat brand to feed his village with quality rice

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Raghunath Arora founded LT Foods to bring quality rice to the table of households in his village. Soon after, it became a globally popular brand — Daawat — with a worldwide reach of 60 nations.

Raghunath Arora, a rice agent, set out on a mission to provide quality rice to the residents of his village, Bhikhiwind in Amritsar, some 70 years ago. In 1965, he established a modest rice trade company, which grew into a partnership enterprise, Lalchand Tirathram Rice Mills (LT Foods), in 1977. He sought to expand the reach of Amritsar’s famous basmati rice, which is used in pulao and biryani, without sacrificing a fair price for the hardworking farmers.

Following such ideals, LT Foods has expanded over the years to become what we now know as the Daawat Basmati rice brand.

So, how did the brand remain relevant for so long?

Ashwani Arora, Managing Director of LT Foods, a second-generation entrepreneur, says, “By preserving the company’s worth. My father founded the company, and my brother, Vijay Kumar Arora, took it global.

Daawat has approximately 20% of the market share in India, despite severe competition from brands like as India Gate, Kohinoor, and others. It currently serves 60 nations.

According to Ashwani, LT Foods’ revenue in FY21 was Rs 4,686 crore. Between 1950 and 1977, LT Foods operated on a small scale in Punjab’s neighbouring territories, with no branding. When Raghunath’s eldest son Vijay joined the company in 1978, the brand expanded to exporting quality Basmati rice to the United States.

Basmati rice is farmed largely in India and since a long time it is being exported to other countries. Ashwani says they control half the US market with Daawat rice.

Since its inception, LT Foods has worked with and for farmers, and as the company developed, so did the number of farmers involved with the brand. LT Foods currently works with 100,000 farmers across India. It includes seven manufacturing plants in India and three in the United States, as well as three packaging plants in the United States.

The company’s headquarters are located in Gurugram, Haryana. The demand for environmentally friendly products is skyrocketing in India. LT Foods adapted to this development in 2012, when it began catering to overseas markets where this demand was evident early on.  Ashwani explains as the international market required organic rice, LT Foods educated farmers and connected them with farming practises aimed at sustainability. He says, “We established the agri section to help farmers with extension services.”

LT Foods developed Ecolife three years ago to soft launch organic rice variations in the Indian market to measure consumer demand. Ashwani says, “Organic products have a bright future.”

LT Foods has aggressively developed into a consumer food firm during the last 70 years by foraying into new categories and building strong brands such as Daawat, Royal, Royal ‘Ready to Heat,’ Daawat Cuppa Rice, Daawat Sauté sauces, and Devaaya, which offer a variety of kitchen basics.

“While the pandemic provided us with good consumer business, the supply chain issue caused a difficulty for everyone in the industry,” Ashwani says.

In the middle of the COVID-19 pandemic, the company ensured the safety of its employees while still providing a consistent experience to its clients. Because the company began investing in automation before to the pandemic, during the lockdown when supply chain issues hampered many factories, LT Foods Ashwani believes it generated results during an unprecedented time when there was a labour shortage. Keeping up with shifting consumer demand is both an opportunity and a struggle for Ashwani.

He believes that innovation is the key to success, and that keeping up with demand is a challenge that the organisation is working to overcome. Because of the growing demand for organic rice in the Indian market, LT Foods’ ecolife brand intends to acquire market share for organic rice and other commodities while also using sustainable farming practises.

It also intends to introduce new ready-to-eat goods and expand into other culinary product categories.

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