Kings Infra's Strategic Approach To Counter The New US Tariffs

VMPL
Kochi (Kerala) [India], April 8: The US Government announced reciprocal tariffs on all goods being imported to the US, which will have major impact on global trade, disrupting the established supply chain. The tariff proposed for India is 26% on all products exported to the US, including seafood. India exports seafood worth approximately USD 2.5 billion of which shrimp constitutes about 92%. The proposed tariff will significantly increase the cost of seafood products in the US market which will ultimately be borne by the US consumers.
As per media reports, about Rs. 2000 crores worth of seafood products from India are in transit or awaiting clearance at the US ports creating an uncertainty on how the increased duties will be shared between the US importers and the Indian exporters. There are also certain forward contracts which may need to be renegotiated after a full clarity is available on how the tariffs will be implemented.
Kings Infra is well insulated and the new tariff will not have any significant impact on its business as the company has no shipments currently in transit to the US. The US market share of the company's products was only 4.3% of the total turnover in the previous financial year as the Board of the company had taken a strategic decision to defer a major entry into the US market for a year until we have complete clarity on the duties and tariffs.
The company has set in place a well laid out strategic plan to counter the medium term and long-term effects of such international trade barriers in the current global scenario which is moving away from globalization of supply chains to more protectionism of their own markets by various countries.
The company has strong business relationships in the European market and we have a Business Development Advisor based in Spain to further expand the business in the European markets. The company also has decades long relationships with Japan and the present scenario presents a great opportunity to renter the Japanese market who has been the number one buyer of Indian products up to late 90s and early 2000s. The company's brands have a very good presence in the retail market in China.
The major suppliers in the value-added products segment to the US market are the companies in Vietnam, China and Thailand who reprocess for the American market. All these countries have higher tariffs imposed on them, compared to India. This presents a golden opportunity for India to diversify and upgrade our products to cater to this segment.
The Indian domestic market offers the highest potential for the aquaculture and seafood companies, as the growing population in India also need high quality protein which is best available from seafood. We intend to refocus our business model by aggressively creating a consumer base for the high quality, high protein ready-to-eat and ready-to-cook Kings Bento and Kings Frigo products in the Indian market. A new IQF factory with facilities for retail and retro packing is being set up at Tuticorin.
Further strengthening its operations, the company continues to invest in sustainable Aquaculture practices, Kings Maritech Eco Park, SISTA360 and Animal Healthcare Division to produce highest quality at most affordable prices. Kings Infra's commitment to innovation and sustainability underscores its long-term growth strategy, ensuring it remains protected from geopolitical trade fluctuations.
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