There are solid indications that the populist programs may have helped to alleviate poverty in rural Thailand, with poverty reduced from a peak of around 42.6 percent of the population in 2000 after the Asian Financial Crisis, to around 13.2 percent in 2011, according to the World Bank; most of the poor live in the country's rural areas.
Thanachart estimates the yearly investment in the rice subsidy program at around 3 percent of gross domestic product (GDP). Some analysts put Bangkok's contribution to GDP at around 30 percent, indicating regions receiving the subsidies are significant contributors to the country's economic growth.
"We see disruption to (the subsidies) curbing the purchasing power of upcountry people," which is likely to hurt retail sales, Thanachart said in a note. "Upcountry growth has played a vital role in driving retail industry growth." It downgraded the retail sector to "underweight" from "overweight."
(Read more: Thai unrest casts doubt on investment expansions)
To be sure, not everyone thinks ending the subsidies would hurt retailers much.
"We've only had (the program) for the past two years," Nirgunan Tiruchelvam, an analyst at Standard Chartered, told CNBC. Farmers don't appear to have adjusted their consumption patterns, he said, noting sales growth at specific companies were steady with levels prior to the subsidy's introduction.
He also believes clearing the government's stockpile will lead to increases in rice prices ahead.
In addition, not everyone is convinced that ending the rice subsidies will mean the end of populist measures.
"Obviously, the farmer should be helped. Subsidies should go directly to supplement their income. We call it income support rather than price support. That would not distort the market," said Riceland's Vichai, who noted that he wants to see current government out of power.
—By CNBC.Com's Leslie Shaffer; Follow her on Twitter @LeslieShaffer1