Avanti Feeds - Revival In Shrimp Prices In Key Market Augurs Well: ICICI Securities
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ICICI Securities Report
We are positive on Avanti Feeds Ltd. as -
1. revival in shrimp prices in its key market, USA augurs well for shrimp processing/feed business. Higher shrimp prices result in better profitability of all players in shrimp value chain,
2. the increase in customs duty on shrimp feed from 5% to 15% in budget in February 2021 will benefit domestic feed manufacturers and
3. due to steep volatility in shrimp prices and profitability, strong players such as Avanti are expected to gain market share from smaller players who are affected more.
The company is also steadily reducing its dependence on USA and non-USA market accounts for ~14% of its exports.
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