ICICI Securities: Avanti Feeds - Better-Than-Expected Recovery In Shrimp Exports
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ICICI Securities Report
Three takeaways from Avanti Feeds Ltd.’s Q1 FY21:
1. The demand for shrimp declined due to lower offtake by hotels, restaurants, cafes and pantry up-stocking by consumers in Q4 FY20,
2. Avanti Feeds is expected to gain market share from smaller shrimp exporters as well as shrimp feed manufacturers and
3. With stability in input prices, the Ebitda margin is likely to stabilize in 11-12% range in FY21-22 (FY20: 11%).
Slowdown in Avanti’s key market (USA) and lower offtake by HoReCa segment (approximately 50% shrimp consumption in USA) may hurt Avanti Feed’s exports.
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